EXHIBIT 10.71
EXECUTION COPY
Confidential Treatment Requested by Pac-West Telecomm, Inc.
TRANSITION SERVICES AGREEMENT
BY AND BETWEEN
U.S. TELEPACIFIC CORP.,
A CALIFORNIA CORPORATION
AND
PAC-WEST TELECOMM, INC.,
A CALIFORNIA CORPORATION
DECEMBER 17, 2004
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
Confidential Treatment Requested by Pac-West Telecomm, Inc.
TABLE OF CONTENTS
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ARTICLE I DEFINITIONS........................................................................................... 1
ARTICLE II SCOPE OF SERVICES.................................................................................... 5
Section 2.1 Network Management Services.............................................................. 5
Section 2.2 Customer Support Services................................................................ 5
Section 2.3 Information Technology and Billing....................................................... 5
Section 2.4 Network Related Services................................................................. 5
Section 2.5 Real Estate Services..................................................................... 5
Section 2.6 Migration Services....................................................................... 5
Section 2.7 Pre-Closing Services..................................................................... 6
Section 2.8 Additional Services...................................................................... 6
Section 2.9 Forecast Report.......................................................................... 6
Section 2.10 MSA/MVP Agreements....................................................................... 7
Section 2.11 Level of Service......................................................................... 7
Section 2.12 Level of Use............................................................................. 8
ARTICLE III FINANCIAL OBLIGATIONS & TRANSITION PERIOD.......................................................... 8
Section 3.1 Pricing and Invoicing.................................................................... 8
Section 3.2 Taxes.................................................................................... 11
Section 3.3 Term of Services......................................................................... 11
ARTICLE IV PERSONNEL............................................................................................ 12
Section 4.1 Right to Designate and Change Personnel.................................................. 12
Section 4.2 The Seller Manager....................................................................... 12
Section 4.3 The Buyer Manager........................................................................ 13
ARTICLE V PROPRIETARY RIGHTS; SOFTWARE.......................................................................... 13
Section 5.1 Third-Party Software..................................................................... 13
Section 5.2 Seller Software.......................................................................... 13
Section 5.3 Use of Trademarks........................................................................ 13
ARTICLE VI SECURITY AND CAPACITY................................................................................ 14
Section 6.1 IT Services; Security.................................................................... 14
Section 6.2 Employee Access.......................................................................... 14
Section 6.3 Increased Capacity....................................................................... 14
ARTICLE VII WARRANTY............................................................................................ 15
Section 7.1 Warranty................................................................................. 15
Section 7.2 Limitation of Liability and Indemnification.............................................. 15
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Section 7.3 Proprietary Information.................................................................. 16
Section 7.4 Survival................................................................................. 17
ARTICLE VIII REMEDIES; DISPUTE RESOLUTION....................................................................... 17
Section 8.1 Specific Performance..................................................................... 17
Section 8.2 Dispute Resolution....................................................................... 18
ARTICLE IX MISCELLANEOUS........................................................................................ 18
Section 9.1 Amendment and Modification............................................................... 18
Section 9.2 Waiver of Compliance; Consents........................................................... 18
Section 9.3 Exhibits and Recitals.................................................................... 18
Section 9.4 Notices.................................................................................. 19
Section 9.5 Assignment or Subcontracting............................................................. 20
Section 9.6 Third Party Beneficiaries................................................................ 21
Section 9.7 Severability............................................................................. 21
Section 9.8 Governing Law............................................................................ 21
Section 9.9 Counterparts............................................................................. 21
Section 9.10 Entire Agreement......................................................................... 22
Section 9.11 Headings................................................................................. 22
Section 9.12 No Partnership or Joint Venture Created.................................................. 22
Section 9.13 Force Majeure............................................................................ 22
Section 9.14 Interpretation; No Strict Construction................................................... 22
Section 9.15 No Conflict.............................................................................. 22
Section 9.16 Expenses................................................................................. 23
Section 9.17 Compliance with Laws..................................................................... 23
Section 9.18 Publicity................................................................................ 23
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EXHIBITS
EXHIBIT 2.1 NETWORK MANAGEMENT SERVICES
EXHIBIT 2.2 CUSTOMER SERVICES
EXHIBIT 2.3 IT AND BILLING SERVICES
EXHIBIT 2.4 NETWORK RELATED SERVICES
EXHIBIT 2.5 REAL ESTATE SERVICES
EXHIBIT 2.6 MIGRATION SERVICES
EXHIBIT 2.7 PRE-CLOSING SERVICES
EXHIBIT 3.1(a) NETWORK MANAGEMENT SERVICES PRICING
EXHIBIT 3.1(b) CUSTOMER SERVICES AND MIGRATION SERVICES PRICING
EXHIBIT 3.1(c) IT AND BILLING SERVICES PRICING
EXHIBIT 3.1(d) NETWORK RELATED SERVICES PRICING
EXHIBIT 3.1(e) REAL ESTATE SERVICES PRICING
EXHIBIT 3.1(f) PRE-CLOSING SERVICES PRICING
EXHIBIT 3.1(g) REPORTS SCHEDULE PRICING
EXHIBIT 3.1(h) SERVICE LEVEL AGREEMENT
EXHIBIT 9.5(c) BUYER DIRECT COMPETITORS
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
TRANSITION SERVICES AGREEMENT
This Transition Services Agreement (this "Agreement") is made and entered
into as of this 17th day of December, 2004 ("Effective Date"), by and between
U.S. TelePacific Corp., a California corporation ("Buyer"), and Pac-West
Telecomm, Inc., a California corporation ("Seller").
WHEREAS, Seller is a facilities-based communications provider offering
telecommunication services, including an integrated bundle of broadband data and
voice communication services, on a direct or retail basis to small- and
medium-sized business customers located in California and Nevada, excluding
businesses and services that Seller provides to residential customers, resellers
and VOIP Customers (collectively, the "SME Business").
WHEREAS, pursuant to that certain Asset Purchase Agreement dated as of the
date hereof (the "Purchase Agreement"), by and between Seller and Buyer, Seller
has agreed to sell to Buyer the Acquired Assets, and Buyer has agreed to
purchase the Acquired Assets and to assume the Assumed Liabilities;
WHEREAS, concurrently herewith Buyer and Seller have entered into the
Purchase Agreement;
WHEREAS, in accordance with the terms of this Agreement, Buyer and Seller
have agreed that Seller or its Affiliates will provide to Buyer (a) certain
pre-closing services prior to the Closing Date in preparation for the Transition
Period, (b) certain support services necessary for Buyer to provide the Services
to SME Customers during the Transition Period and (c) certain consulting
services necessary for Buyer develop its ability to provide the Services to SME
Customers following the Transition Period;
NOW, THEREFORE, in consideration of the foregoing and mutual agreements
contained herein, and for other good and valuable consideration, the value,
receipt and sufficiency of which are acknowledged, the parties, intending to be
legally bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
Any term capitalized herein which is not otherwise defined shall have the
meaning assigned to it in the Purchase Agreement. In addition, the following
terms shall have the meaning provided:
"Additional Services" has the meaning set forth in Section 2.8.
"Agreement" has the meaning set forth in the preamble, including all
attached exhibits.
"Buyer" has the meaning set forth in the preamble.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
"Buyer Invoice Date" has the meaning set forth in Section 3.1(g).
"Buyer Manager" has the meaning set forth in Section 4.3.
"Contract" has the meaning set forth in Section 2.11.
"Customer Support Floor" has the meaning set forth in Section 3.1(f).
"Customer Support Services" has the meaning set forth in Section 2.2.
"Direct Competitor" means (a) Competitive Local Exchange Carrier (CLEC)
with a Certificate of Public Convenience and Necessity that permits it to
provide telecommunications services substantially similar to the Services in the
Markets; (b) an Incumbent Local Exchange Carrier (ILEC) that provides
telecommunications services substantially similar to the Services in the
Markets; (c) any of the entities identified in the attached Exhibit 9.5(c); or
(d) any Affiliate of any entity included within clauses (a), (b) and (c) above.
"Disputed Amounts" has the meaning set forth in Section 3.1(i).
"Effective Date" has the meaning set forth in the preamble.
"Extension Period" has the meaning set forth in Section 3.3(b).
"Forecast Report" has the meaning set forth in Section 2.9.
"Industry Expert" has the meaning set forth in Section 3.1(j).
"In-Flight Orders" shall mean orders for telecommunications services
placed by SME Customers before the Closing Date where Seller has not fully
provisioned all the services ordered prior to the Closing Date.
"Invoiced Amount" has the meaning set forth in Section 3.1(g).
"Invoice Date" has the meaning set forth in Section 3.1(g).
"Invoice Resolution Period" has the meaning set forth in Section 3.1(i).
"IT and Billing Floor" has the meaning set forth in Section 3.1(f).
"IT and Billing Services" has the meaning set forth in Section 2.3.
"Markets" means the geographic markets within California and Nevada in
which Seller provided Services immediately prior to the date of this Agreement.
"Migration Services" has the meaning set forth in Section 2.6.
"Minimum Floor" has the meaning set forth in Section 3.1(f).
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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"Monthly Fee Floor" has the meaning set forth in Section 3.1(f).
"MSA Agreements" has the meaning set forth in Section 2.10(a).
"MVP Agreement" has the meaning set forth in Section 2.10(b).
"Network Management Floor" has the meaning set forth in Section 3.1(f).
"Network Management Services" has the meaning set forth in Section 2.1.
"Network Related Floor" has the meaning set forth in Section 3.1(f).
"Network Related Services" has the meaning set forth in Section 2.4.
"Network Related Services Cap" has the meaning set forth in Section
3.1(d).
"New Customer Services" means Services provided to, or in support of, any
person or entity that becomes a SME Customer during the Transition Period.
"New Services" means voice or data products or related services provided
by Seller during the Transition Period that were not provided by Seller to, or
in support of, any SME Customers prior to the Effective Date.
"NOC" has the meaning set forth in Section 2.1.
"Notice of Breach" has the meaning set forth in Section 3.3(d).
"Pre-Closing Period" has the meaning set forth in Section 3.3(c).
"Pre-Closing Services" has the meaning set forth in Section 2.7.
"Post-Closing Orders" means orders for telecommunications services placed
by SME Customers after the Closing Date where such orders have been placed to
Seller and responsibility for receipt and provisioning of new orders has not yet
transitioned to Buyer.
"Purchase Agreement" has the meaning set forth in the recitals.
"Real Estate Services" has the meaning set forth in Section 2.5.
"Resource Modeling Tool" means a tool developed by the parties used to
estimate resources required by Seller to support the Transition Services in
Network Management Services, Customer Support Services and Migration Services.
"Seller" has the meaning set forth in the preamble.
"Seller Cap" means the maximum aggregate liability of Seller for claims
(a) arising out of or relating to this Agreement or any of the Pre-Closing
Services or Transition Services and (b)
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brought within the time period specified below, such maximum liability of Seller
as set forth opposite such time period below:
Calendar Days Maximum Aggregate
Following Closing Liability of Seller
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0 through 180 $ 15,500,000
181 through 270 $ 7,750,000
271 through 360 $ 3,875,000
361 and thereafter $ 1,000,000
"Seller Manager" has the meaning set forth in Section 4.2.
"Service Availability" means, with respect to outage events adversely
affecting Network Related Services involving ten (10) or more DS-1s and/or any
DS-3s, in each case, servicing SME Customers, the total number minutes of outage
event time in any calendar month, divided by the total number of minutes in such
calendar month.
"Service Availability Floor" has the meaning set forth in Section 7.2(e).
"Service Charge" has the meaning set forth in Section 3.1(c).
"Service Level Agreement" has the meaning set forth in Section 3.1(a).
"Services" means those data and voice communications services provided by
Seller to SME Customers in the Markets immediately prior to the Effective Date
of this Agreement.
"SME Business" has the meaning set forth in the recitals.
"SME Customers" mean bona fide customers of the SME Business located in
the Markets.
"Specified Network Related Services" means the services supporting the
provision of XX-0, XX-0 and other transport and loop circuits, which (a) include
those services specified in the attached Exhibit 2.4 other than (i) Allocated
Direct Internet Access ("DIA"), Local number Portability ("LNP") dips and other
related costs, CNAM/LIDB, SMS access, 911 and (ii) such other services as Buyer
and Seller may agree to prior to Closing (Buyer's agreement not to be
unreasonably withheld), and (b) exclude (i) any New Services and (ii) any New
Customer Services.
"Sub-Leases" has the meaning set forth in Section 2.5.
"Trademarks" has the meaning set forth in Section 5.3.
"Transition Period" has the meaning set forth in Section 3.3(a).
"Transition Plan" has the meaning set forth in Section 2.7(a).
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
"Transition Services" means the Additional Services, Customer Support
Services, IT and Billing Services, Migration Services, Network Management
Services, Network Related Services and Real Estate Services.
ARTICLE II
SCOPE OF SERVICES
Section 2.1 Network Management Services. During the Transition Period,
Seller shall provide, or cause to be provided, those network management
services, including engineering and operations services, necessary to provide
Services to SME Customers, and operate the Network Operations Center ("NOC"), in
each case, as, and in the manner, more particularly described in the attached
Exhibit 2.1 (the "Network Management Services"), subject to any service levels,
termination of service or rights, conditions or policies applicable to Buyer and
Seller as set forth in this Agreement.
Section 2.2 Customer Support Services. During the Transition Period,
Seller shall provide, or cause to be provided, those customer support services
necessary to provide Services to SME Customers, as, and in the manner, more
particularly described in Exhibit 2.2 (the "Customer Support Services"), subject
to any service levels, termination of service or rights, conditions or policies
applicable to Buyer and Seller as set forth in this Agreement.
Section 2.3 Information Technology and Billing. During the Transition
Period, Seller shall provide, or cause to be provided information technology and
billing services necessary to provide Services to SME Customers, in each case,
as, and in the manner, more particularly described in the attached Exhibit 2.3
(the "IT and Billing Services"), subject to any service levels, termination of
service or rights, conditions or policies applicable to Buyer and Seller as set
forth in this Agreement.
Section 2.4 Network Related Services. During the Transition Period, Seller
shall provide, or cause to be provided, network facilities necessary to provide
Services to SME Customers, as, and in the manner, more particularly described in
the attached Exhibit 2.4 (the "Network Related Services"), subject to any
service levels, termination of service or rights, conditions or policies
applicable to Buyer and Seller as set forth in this Agreement.
Section 2.5 Real Estate Services. During the Transition Period, Seller
shall provide, or cause to be provided, real estate facilities necessary to
provide Services to SME Customers, consistent with the terms of any real estate
sub-leases (the "Sub-Leases") entered into by Buyer and Seller in connection
therewith, as, and in the manner, more particularly described in the attached
Exhibit 2.5 (the "Real Estate Services"), subject to any service levels,
termination of service or rights, conditions or policies applicable to Buyer and
Seller as set forth in this Agreement or any applicable Sub-Lease. Buyer will
adhere to any conditions or policies applicable to the Real Estate Services as
set forth in this Agreement and the Sub-Leases.
Section 2.6 Migration Services. During the Transition Period, Seller shall
provide, or cause to be provided, services necessary for the migration of SME
Customers to network facilities owned or provisioned by Buyer, as, and in the
manner, more particularly described in
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the attached Exhibit 2.6 (the "Migration Services"), subject to any service
levels, termination or conditions of service or rights, conditions or policies
applicable to Buyer and Seller as set forth in this Agreement.
Section 2.7 Pre-Closing Services. Between the Effective Date and the
Closing Date, Seller shall provide, or cause to be provided, certain pre-closing
services necessary to prepare for the Transition Period as, and in the manner,
more particularly described in the attached Exhibit 2.7 (the "Pre-Closing
Services"), subject to any service levels, termination of service or rights,
conditions or policies applicable to Buyer and Seller as set forth in this
Agreement.
(a) In addition to those Pre-Closing Services described in the attached
Exhibit 2.7, as a Pre-Closing Service, Seller will cooperate with Buyer in
Buyer's development and implementation of a transition plan (the "Transition
Plan"), which shall include a detailed plan for the migration of circuits from
Seller's network facilities to the network facilities owned or provisioned by
Buyer that reduces to the extent reasonable to do so termination liability
associated with the termination of agreements and vendors with respect to such
circuits.
(i) The Transition Plan shall have as its general principles: (A)
retention of SME Customers during the Transition Period and minimization
of customer "churn" or turnover; (B) maintaining continuity, quality of
service and customer satisfaction in connection with the migration; (C)
effecting a rapid yet prudent migration; (D) developing a realistic
transition schedule for the migration of SME Customers to Buyer's network
that recognizes potential efficiencies to be realized on Buyer's network
facilities after migration is complete, and to the extent reasonable to do
so, termination costs associated with the existing Seller's circuits that
would be disconnected as a result of the migration; and (E) producing a
network and service configuration after migration that is as efficient as
possible in enabling Buyer to utilize its network structure and design
provide cost-effective Services to SME Customers.
(ii) Notwithstanding anything else to the contrary in this
Agreement, the Transition Plan shall provide, and the parties agree, that
seventeen (17) of the top twenty (20) of Seller's DS-3s as set forth on a
schedule to be prepared in good faith by Seller and delivered to Buyer
thirty (30) calendar days from the Effective Date (as measured by the
amount of termination liability associated with such circuit), as
designated by Buyer, shall not be migrated to Buyer's network facilities
prior to the end of the second full calendar month following the Closing
Date to permit negotiation of reduced termination liability.
Section 2.8 Additional Services. Beginning on the Effective Date and
continuing through the end of the Transition Period, Seller shall provide, or
cause to be provided, any additional transition services as Seller and Buyer
mutually may agree are necessary to provide services to SME Customers
("Additional Services"), such Additional Services to be provided on a time and
materials basis.
Section 2.9 Forecast Report. Beginning on the Effective Date and
continuing through the end of the Transition Period, Buyer will provide Seller
on the 5th business day of each
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calendar month a rolling three (3) month forecast report ("Forecast Report"),
including a good faith estimate of the quantity of each Transition Service it
anticipates requiring from Seller, which Forecast Report is purely for planning
purposes. The Forecast Report will include each cost category in Exhibits 3.1(a)
through (f) and will contain sufficient detail to enable Seller to perform
resource planning. It is expressly understood between the parties that the
Forecast Reports are prepared for purposes of planning only and are not a
binding contractual commitment to acquire any Transition Services. The parties
agree that the Resource Modeling Tool will be used to help determine the amount
of resources required to support forecasted demand on a mutually agreed basis.
Section 2.10 MSA/MVP Agreements.
(a) Buyer shall cooperate with Seller in connection with Seller's efforts
to minimize any obligation, including early termination charges, termination
liability adjustments, and obligations with respect to minimum revenue
commitments, as may arise under any master service agreements between Seller and
any carriers ("MSA Agreements") when Seller cancels or discontinues services
supporting SME Customers under such MSA Agreements during the Transition Period.
In connection therewith, Buyer shall, to the extent permitted to do so,
participate in any discussions or negotiations with carriers regarding Seller's
obligations under MSA Agreements. Buyer may enter into arrangements with
carriers and Seller in which will reduce Seller's obligations under MSA
Agreements where Buyer (in its sole discretion) concludes that it will do so,
taking into account such considerations as costs and performance risks,
objectives of quality and continuity of service and Buyer's requirement that it
control the operational aspects, including scheduling and cut-over, of any
transition of such services.
(b) Buyer agrees, during the Transition Period, to cooperate with Seller
in order to minimize Seller's minimum revenue commitments under Seller's MSA
Agreement with SBC (the "MVP Agreement"). In connection therewith, Buyer shall,
to the extent permitted to do so, participate in any discussions or negotiations
with SBC regarding Seller's obligations under the MVP Agreement, where such
discussions concern (i) Buyer's present or future requirements for circuits or
services in territories serviced by SBC, and (ii) whether such requirements, if
satisfied by SBC, would be deemed by SBC to xxxxx or reduce Seller's obligations
under the MVP Agreement. Buyer may enter into arrangements with SBC and Seller,
if acceptable to SBC, which will reduce Seller's obligations under the MVP
Agreement where Buyer (in its sole discretion) concludes that it will do so,
taking into account such considerations as costs and performance risks,
objectives of quality and continuity of service and Buyer's requirement that it
control the operational aspects, including scheduling and cut-over, of any
transition of such services. Buyer shall have no obligation to acquire any
services from SBC, accept any assignment of services presently acquired by
Seller from SBC, or assume any liability arising from Seller's MVP Agreement,
except as may be agreed in writing among SBC, Seller and Buyer.
Section 2.11 Level of Service. Seller will use commercially reasonable
efforts to provide or cause to be provided the Transition Services, in the
manner and at a relative level of service substantially similar to that provided
by Seller to SME Customers immediately prior to the Closing Date, subject to the
other provisions of this Agreement. Subject to Section 9.5(a),
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Seller shall have the right to subcontract to third parties any of its
obligations to provide Transition Services, provided that such right in no way
relieves or diminishes Seller's obligation under this Agreement. In making the
Transition Services available to Buyer, Seller shall not be obligated to take
any particular or specific action (including favoring Buyer or SME Customers
over Seller's business, operations or customers), except as required
specifically to perform its obligation to provide the Transition Services
required by this Agreement.
Section 2.12 Level of Use. Buyer agrees that Seller shall not be obligated
to provide any Transition Services hereunder that exceed the aggregate level of
the applicable Service provided by Seller to SME Customers during the three (3)
months immediately prior to the Closing Date, excepting (i) Additional Services,
(ii) Migration Services, and (iii) such Services as are required to respond to
increases in demand or utilization by SME Customers (who were SME Customers at
the time of Closing or become SME Customers during the first three (3) months
after Closing) during the Transition Period. Without limiting the foregoing,
absent prior written agreement of Seller, no New Services are to be provided to
such SME Customers during the Transition Period that require utilization of
Seller's facilities or services.
Section 2.13 Process Ownership. Beginning on the Closing Date, Buyer shall
be responsible for the cash processing, sales, sales commission, sales
engineering, sale coordination, service delivery project management, customer
relationship management, call center, customer premise equipment programming
(also known as "TAC"), warehouse and related equipment purchases and staging,
field operations, dispatch and related functions previously performed by Seller.
ARTICLE III
FINANCIAL OBLIGATIONS & TRANSITION PERIOD
Section 3.1 Pricing and Invoicing.
(a) Except as otherwise provided in this Section 3.1, as consideration for
the Transition Services, Buyer will pay to Seller the amounts specified for each
Transition Service in Exhibits 3.1(a) through (g) in accordance with this
Section 3.1, subject to downward only adjustment in accordance with the Service
Level Agreement set forth in Exhibit 3.1(h) (the "Service Level Agreement").
(b) Buyer's obligation to pay Seller for Network Related Services shall
not become due and payable until amounts due Seller resulting from Seller's
provision of Network Related Services equal or exceed an aggregate of Two
Million Dollars ($2,000,000), and then Buyer shall only pay Seller for any
amounts due and payable by Buyer in respect of Network Related Services in
excess of Two Million Dollars ($2,000,000).
(c) As consideration for the Pre-Closing Services, Buyer will pay to
Seller the amounts specified for each Pre-Closing Service in Exhibit 2.7. If the
transactions contemplated by the Purchase Agreement close, Seller shall include
any amounts owed in respect of Pre-Closing Services in any invoice delivered to
Buyer following the Closing Date in respect of Invoiced Amounts. If the
transactions contemplated by the Purchase Agreement do not close,
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and the Purchase Agreement is terminated in accordance with its terms other than
because of Seller's breach thereof, Seller shall send to Buyer within thirty
(30) days of the date of termination of the Purchase Agreement an invoice that
includes any amounts owed in respect of Pre-Closing Services. Payment of such
amounts is due from Buyer within fifteen (15) business days of delivery to Buyer
of such invoice. Amounts not paid when due shall incur a service charge of the
lesser of 12% per annum and the maximum rate permitted under applicable usury
laws (the "Service Charge"), accruing from the date of delivery to Buyer of such
invoice until the date when such invoice is paid in full. Seller will provide
documentation supporting any amounts invoiced pursuant to this Section 3.1(c) as
Buyer may reasonably request. Buyer may dispute any amounts invoiced pursuant to
the mechanism set forth in Section 3.1(i) and (j).
(d) Notwithstanding the foregoing, Buyer's obligations to pay Seller for
circuit and usage costs associated with Specified Network Related Services
during the Transition Period shall not exceed an aggregate of Ten Million Five
Hundred Thousand Dollars ($10,500,000) (the "Network Related Services Cap"). For
purposes of determining the Network Related Services Cap pursuant to the
preceding sentence, Buyer's obligations to pay Seller shall be deemed to include
any amounts credited to Buyer for Specified Network Related Services (as part of
Network Related Services) pursuant to Section 3.1(b).
(e) In the event Seller continues to provide Transition Services during
the Extension Period, Buyer shall pay to Seller the amounts specified for each
Transition Service in Exhibits 3.1(a) through (g) without any regard to the
Network Related Services Cap.
(f) Notwithstanding anything to the contrary in Section 3.1(a), the
aggregate minimum amount of fees payable in any calendar month during the
Transition Period (the "Minimum Floor") shall be as follows:
(i) for Network Management Services (Section 2.1), the Minimum Floor
shall be [**] (the "Network Management Floor");
(ii) for Customer Support Services (Section 2.2), the Minimum Floor
shall be [**] (the "Customer Support Floor");
(iii) for IT and Billing Services (Section 2.3), the Minimum Floor
shall be [**] (the "IT and Billing Floor"); and
(iv) for Network Related Services (Section 2.4), the Minimum Floor
shall be [**] (the "Network Related Floor").
The Network Management Floor, the Customer Support Floor the IT and Billing
Floor and the Network Related Floor comprise the "Monthly Fee Floor."
(g) Seller will invoice Buyer on or prior to the 10th business day of each
month or as soon as reasonably practicable thereafter (the "Invoice Date") for
(i) an amount equal to the Monthly Fee Floor in respect of such calendar month,
(ii) an amount, if positive, equal to (A) amounts owed by Buyer as a result of
Transition Services provided to Buyer pursuant to Section 3.1(a) in any period
prior to such calendar month (including any amounts omitted by Seller from
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prior invoices to Buyer under this Section 3.1) minus (B) an amount equal to the
Monthly Fee Floor in respect of the immediately prior calendar month and (iii)
an amount equal to all amounts owed by Buyer as a result of Pre-Closing Services
provided to Buyer pursuant to Section 3.1(a) (collectively, the "Invoiced
Amount"); provided that if the Closing Date occurs on a date other than the
first day of a calendar month, the Monthly Fee Floor for such calendar month
shall be pro-rated for the number of days remaining in such calendar month
following the Closing Date and shall be invoiced by Seller within three (3)
business days of the Closing Date, or as soon as reasonably practicable
thereafter. Payment of Invoiced Amounts is due from Buyer within fifteen (15)
business days of Buyer's receipt of the related invoice (such date of receipt,
the "Buyer Invoice Date"). Invoiced Amounts not paid when due shall incur the
Service Charge, accruing from the Buyer Invoice Date until the date when paid in
full. Seller will provide documentation supporting any Invoiced Amount pursuant
to this Section 3.1 as Buyer may from time to time reasonably request, including
third party billing information relating to the Transition Services provided
under this Agreement.
(h) The parties recognize that the Transition Services provided by Seller
include certain services that Seller obtains from third parties including common
carriers and that, in some cases, Seller does not receive timely billing from
such third party vendors or service providers. In this regard, the parties agree
that to the extent Seller does not receive within three (3) business days prior
to the Invoice Date, an invoice for services provided, the customary billing
date of which precedes the Invoice Date, and Seller can reasonably estimate the
cost of such services, Seller may make a reasonable good faith estimate of the
cost of such services based on historical xxxxxxxx of such vendor or service
provider taking into account known or anticipated reductions in products and
services provided by such vendor or service provider for such calendar month and
include such amount in the Invoiced Amount for such calendar month. In such
circumstances, to the extent the actual cost of the services are different than
the estimated cost of the services for such calendar month, Seller will
reconcile the difference between the actual cost and estimated cost and decrease
or increase the Invoiced Amount for the immediately following calendar month by
the appropriate amount. Seller shall upon request by Buyer provide to Buyer
documentation reasonably necessary to support the estimate and account for the
reconciliation.
(i) Buyer shall have ten (10) business days from the Buyer Invoice Date to
review the Invoiced Amounts. Unless Buyer delivers written notice to Seller on
or prior to the tenth business day from the Buyer Invoice Date specifying in
reasonably detail all disputed items in respect of the Invoiced Amounts and the
basis therefor ("Disputed Amounts"), Buyer shall be deemed to have accepted and
agreed to the Invoiced Amounts (other than any Disputed Amounts) as reflected on
the related invoice and shall be obligated to pay all amounts other than
Disputed Amounts in accordance with the terms of this Agreement. If Buyer so
notifies Seller of the existence of Disputed Amounts, the Seller Manager and
Buyer Manager shall, within thirty (30) calendar days following such notice (the
"Invoice Resolution Period"), act in good faith to resolve themselves the
differences between Buyer and Seller, and any resolution by them as to any
Disputed Amounts shall be final, binding and conclusive. If applicable, Buyer
shall pay any additional portion of such Disputed Amounts determined to be owed
by Buyer to Seller, together with any applicable Service Charge, within five (5)
business days of such determination.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
(j) If the Seller Manager and Buyer Manager are unable to resolve all or
any portion of the Disputed Amounts within the Invoice Resolution Period, then
the remaining Disputed Amounts shall be submitted to an independent industry
expert (the "Industry Expert"), as may be mutually acceptable to Buyer and
Seller, for resolution. The Industry Expert shall act as an arbitrator to
determine, based solely on presentations by Buyer and Seller and not by
independent review, only the remaining Disputed Amounts. Each party will furnish
to the Industry Expert such work papers and other documents and information
relating to the disputed issues as the Independent Expert may request and are
available to that party, and will be afforded the opportunity to present to the
Industry Expert any material relating to the remaining Disputed Amounts and to
discuss the issues with the Industry Expert. The Industry Expert's determination
shall be made within thirty (30) calendar days of its selection, shall be set
forth in a written statement delivered to Buyer and Seller by the Industry
Expert and shall be final, binding and conclusive on the parties. If applicable,
Buyer shall pay any additional portion of such Disputed Amounts determined to be
owed by Buyer to Seller within five (5) business days of such determination. All
fees and expenses relating to the work, if any, to be performed by the Industry
Expert shall be borne equally by Buyer and Seller.
Section 3.2 Taxes. To the extent applicable federal or state law or
regulation imposes taxes, charges or fees (including USF) on Seller in
connection with providing any Pre-Closing Services or Transition Services
hereunder, Seller shall pay such charges to the appropriate authorities as
required under applicable law or regulation, and, upon receipt of reasonable
documentation in support thereof, Buyer shall reimburse Seller for such taxes,
charges or fees as soon as reasonably practicable thereafter. Subject to the
foregoing, all such sales, use and other similar taxes, and other similar
assessments and fees, including municipal utility taxes and fees, universal
service taxes and fees, public utility commission support taxes and fees,
assessed by local, state or federal authorities that results from Seller
providing Pre-Closing Services or Transition Services hereunder shall be the
responsibility of Buyer. For purposes of clarity, such taxes, assessments and
fees referred to in this Section 3.2 shall not include any income Taxes.
Section 3.3 Term of Services.
(a) Transition Period. Transition Services under this Agreement shall
commence on the Closing Date and continue for a period ending on the date which
is the twelve (12) month anniversary of the Closing Date (the "Transition
Period"), unless (i) sooner terminated pursuant to the terms hereof or (ii)
extended pursuant to Section 3.3(b).
(b) Extension Period. Notwithstanding the foregoing, upon the prior
written request of Buyer provided to Seller no less than sixty (60) calendar
days prior to the end of the Transition Period then in effect, the Transition
Period shall be extended for an additional three (3) months (each, an "Extension
Period"); provided that under no circumstances shall the Transition Period
extend beyond eighteen (18) months following the Closing Date.
(c) Pre-Closing Period. Pre-Closing Services under this Agreement shall
commence on the Effective Date and continue (unless sooner terminated pursuant
to the terms hereof) for a period beginning on the Effective Date and ending on
the Closing Date (the "Pre-Closing Period").
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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(d) Early Termination. In the event either party materially breaches this
Agreement, the non-breaching party shall give the breaching party prompt written
notice thereof (a "Notice of Breach"), but in no event shall such notice be
given later than ten (10) business days following the occurrence of such
material breach. For purposes hereof, the failure by Buyer to pay to Seller (i)
any Invoiced Amounts not properly disputed pursuant to Section 3.1(i) within
fifty (50) calendar days of the applicable Buyer Invoice Date or (ii) any
previously Disputed Amounts determined to be due and payable to Seller pursuant
to Sections 3.1(i) and (j) within the timeframe provided for therein shall each
be deemed to be a material breach of this Agreement; provided that in the case
of clauses (i) and (ii) above, written notice of failure to pay has been
provided and an opportunity of not less than ten (10) days to remedy the
non-payment has been afforded, without payment having been received. With
respect to claims of breach that do not involve nonpayment as contemplated in
the immediately preceding sentence, upon receipt of a Notice of Breach, the
breaching party will have a reasonable time to cure the breach. If after such
time the breaching party has failed to cure the breach, the non-breaching party
may terminate this Agreement or any Pre-Closing Services or Transition Services
hereunder, and upon such termination, all unpaid fees and other charges for
services actually provided or costs actually incurred under this Agreement in
respect of the terminated Pre-Closing Services and the Transition Services prior
to the date of termination shall become immediately due and payable.
(e) Adjustment to Transition Services. Notwithstanding any other provision
of this Agreement to the contrary, Buyer shall have the unilateral right to
modify or adjust its business practices, policies, and procedures in the
ordinary course of business. Where such action, as Buyer may take in its sole
discretion, will result in a reduction or elimination of Buyer's requirement for
any Transition Services, Buyer shall provide to Seller fifteen (15) calendar
days prior written notice specifying the adjustment or reduction of services.
ARTICLE IV
PERSONNEL
Section 4.1 Right to Designate and Change Personnel. Seller will have the
right, in its sole discretion, to designate which personnel it will assign to
perform the Transition Services. Seller also will have the right, in its
discretion, to remove and replace any such personnel at any time or designate a
third-party provider. In the event that personnel with the designated level of
experience are not then employed by Seller, Seller may substitute such personnel
or third party personnel having an adequate level of experience; provided that
Seller will have no obligation to retain or hire any individual employee for the
sole purpose of providing the applicable Transition Services. Seller is
responsible for the scheduling, quality and timeliness of its employees, agents
and third party vendors that it selects.
Section 4.2 The Seller Manager. Seller designates Xxxx Xxxxx (the "Seller
Manager") who will have overall responsibility for managing and coordinating the
delivery of the Transition Services and will coordinate and consult with the
Buyer Manager (as defined in Section 4.3 below). Seller may, at its sole
discretion, designate other individuals to serve in the capacity of the Seller
Manager by providing Buyer written notice of such designation.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Section 4.3 The Buyer Manager. Buyer designates Xxxxxxxx Xxxxx (the "Buyer
Manager") who will have overall responsibility for managing and coordinating the
receipt of the Pre-Closing Services and the Transition Services and will
coordinate and consult with Seller Manager. Buyer may, at its sole discretion,
designate other individuals to serve in the capacity of the Buyer Manager by
providing Seller written notice of such designation.
ARTICLE V
PROPRIETARY RIGHTS; SOFTWARE
Section 5.1 Third-Party Software. In addition to the consideration set
forth elsewhere herein, Buyer shall also pay any amounts that are required to be
paid to any licensors of computer software that is used primarily in connection
with, or necessary to the provision of, any Transition Services hereunder, and
any amounts that are required to be paid to any licensors of computer software
to obtain the consent of such licensors to provide any of the Transition
Services hereunder. Buyer's obligation does not extend to any amounts due and
payable or otherwise owed by Seller to any such vendor for the right or license
to use such software prior to the Effective Date. Subject to the forgoing,
Seller will use commercially reasonable efforts to assist Buyer in obtaining any
consent that may be required from such licensors in order to provide any and all
of the Transition Services hereunder; provided, however, that Seller shall not
be required to pay any cash or other consideration, waive or amend any right, or
incur or agree to incur any additional obligation in order to obtain any such
consent, except where it has agreed with Buyer in order to fulfill the
objectives of this Article V. In the event that any such consent is not
obtained, Seller shall not be obligated to provide any of the Transition
Services hereunder where the performance or provision of such services would
violate the terms of a license or other agreement, but Seller will cooperate
with Buyer with respect to such services that may not be performed without such
consent, to seek alternative software or solutions to continue to provide such
services or a substitute reasonably suitable to Buyer, through means that do not
infringe existing licenses or prompt vendor objections.
Section 5.2 Seller Software. Any computer software, software development
tools, software methodologies and processes, or software technologies owned by
Seller and which may during the term of this Agreement be operated or used by
Seller in connection with the provision of the Transition Services hereunder
will remain Seller's sole and exclusive property, and Buyer will have no rights
or interests therein.
Section 5.3 Use of Trademarks. Seller hereby grants Buyer a non-exclusive,
non-transferable, royalty-free license (with no right to grant sublicenses) to
use, in connection with providing Services to SME Customers during the
Transition Period, the following unregistered trademarks: "Data Advantage,"
"DTTS," "IAS," and "FBDT" (collectively, the "Trademarks"). Seller is familiar
with the quality of services provided by Buyer to its customers prior to the
Closing. The quality of the Services in connection with which Buyer uses the
Trademarks shall be of at least the same quality as such services provided by
Buyer to its customers prior to the Closing. Buyer shall use the Trademarks in
accordance with generally acceptable proper trademark usage standards and in a
manner consistent with the manner in which Seller used the Trademarks in
connection with Services provided by Seller to SME Customers immediately prior
to the Closing. Buyer shall not use the Trademarks in combination with or in
close
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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proximity to any other marks, except that Buyer may use the Trademarks in
proximity to Buyer's trademarks in a manner consistent with or intended to
reflect the transitional nature of Buyer's use of the Trademarks. Seller shall
at all times be the sole and exclusive owner of the Trademarks, and all use of
the Trademarks by Buyer shall inure to the benefit of Seller. After the
Transition Period, Buyer shall immediately cease all use of the Trademarks,
including by removing the Trademarks from all products, packaging, and
advertising and promotional materials, except that Buyer may continue to use the
Trademarks in connection with its invoices and other customer billing materials
for a period of three (3) years following termination or expiration of the
Transition Period. Buyer shall not take any action or intentionally fail to take
any action that would adversely affect the validity or enforceability of the
Trademarks or the goodwill associated therewith. Buyer shall not use the
Trademarks other than as expressly permitted by this Section 5.3.
ARTICLE VI
SECURITY AND CAPACITY
Section 6.1 IT Services; Security. In connection with accessing or using
any information systems or communications services of Seller (whether or not
identified in an Exhibit hereto), Buyer shall adhere in all respects to Seller's
corporate information policies (including policies with respect to protection of
proprietary information and other policies regarding the use of computing
resources) as in effect from time to time and as provided to Buyer.
Section 6.2 Employee Access. During the term of this Agreement, employees
of the SME Business may access Seller's information systems, as set forth in
Exhibits hereto, if they meet the following criteria: (i) such employee (x) was
a Retained Employee at the time of the Closing or (y) was hired or transferred
by Buyer after the Closing as an employee of the SME Business; (ii) Buyer has a
reasonable and documented business need to access resources on Seller's
information systems during the term of this Agreement, the access is approved in
writing by the Seller Manager and the Buyer Manager, an expiration date for such
access is established, a current list of Buyer employees having access is
available online in a database accessible by Seller staff, and a documented
process is in place for ensuring that such database is kept current; and (iii)
such employee has signed a customary non-disclosure agreement (in a form
reasonably acceptable to Seller) for the benefit of Seller. Buyer shall ensure
that all Buyer employees that are connected to Seller's information systems
adhere in all respects to the security requirements established by Seller,
including standards intended, among other things, to ensure the protection of
proprietary information, to require current active antivirus protection at all
times, to ensure strong access control for all computer access, to prohibit
sharing of passwords, and to prohibit dual connections to Seller's information
systems.
Section 6.3 Increased Capacity. Should Buyer's requirements for Transition
Services cause an increase in Buyer's use, during the Transition Period, of
Seller's computing systems capacities, Seller shall use commercially reasonable
efforts to notify Buyer of such increased use in order to enable the parties to
assess jointly whether to change or continue the practices that have given rise
to such increased use. If and to the extent, following such consultation, such
increased use requires and results in Seller acquiring additional computing
capacity, and where
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
the parties agree that Seller will not use or need such additional capacity
other than to satisfy the additional use requirements imposed by Transition
Services, then Buyer will reimburse Seller for all costs incurred by Seller in
connection with the increased capacity. Where there is a ratable basis to
allocate the increased capacity required for Buyer and that which Seller shall
use and employ for its own purposes, Buyer shall be responsible only for the
costs associated with the capacity that is proportional to its utilization.
Notwithstanding the foregoing, Seller shall be obligated, at no expense to
Buyer, to evaluate its computing capacity and to provision for adequate
computing capacity as will permit provision of Transition Services during the
Transition Period, such that ordinary growth in use as may arise from increased
orders that are placed during the first two (2) months following the Closing
Date will require no increase in computing capacity. Should any such increase be
required, it will be at the sole expense and responsibility of Seller.
ARTICLE VII
WARRANTY
Section 7.1 Warranty. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER SELLER NOR ITS AFFILIATES MAKES ANY REPRESENTATIONS OR WARRANTIES OF ANY
KIND, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY WITH RESPECT TO THE TRANSITION
SERVICES OR THE SUBJECT MATTER OF THIS AGREEMENT, INCLUDING ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR ANY PARTICULAR PURPOSE, ACCURACY, AVAILABILITY,
TIMELINESS, COMPLETENESS OR THE RESULTS TO BE OBTAINED FROM SUCH TRANSITION
SERVICES, AND SELLER AND ITS AFFILIATES HEREBY DISCLAIM THE SAME.
Section 7.2 Limitation of Liability and Indemnification.
(a) SELLER SHALL NOT BE LIABLE TO BUYER, ITS AFFILIATES OR ANY THIRD PARTY
(A) FOR ANY PUNITIVE, EXEMPLARY OR OTHER SPECIAL DAMAGES ARISING UNDER OR
RELATING TO THIS AGREEMENT OR THE SUBJECT MATTER HEREOF, AND/OR (B) FOR ANY
INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOSS OF USE,
INCOME, PROFITS OR ANTICIPATED REVENUES, PROFITS, BUSINESS OR BUSINESS
OPPORTUNITY, SAVINGS, DATA, OR AGREEMENT REPUTATION RELATING TO THE SAME)
ARISING FROM ANY CLAIM UNDER OR RELATING TO THIS AGREEMENT OR ANY OF THE
TRANSITION SERVICES PROVIDED HEREUNDER, WHETHER SUCH CLAIM IS BASED ON WARRANTY,
CONTRACT, TORT (INCLUDING NEGLIGENCE OR STRICT LIABILITY) OR OTHERWISE, WHETHER
OR NOT SELLER HAS BEEN ADVISED OF, OR MIGHT OTHERWISE HAVE ANTICIPATED, THE
POSSIBILITY OF SUCH LOSSES OR DAMAGES.
(b) NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, IN NO EVENT
SHALL THE AGGREGATE LIABILITY OF SELLER ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OF THE PRE-CLOSING OR TRANSITION SERVICES PROVIDED HEREUNDER
EXCEED THE SELLER CAP,
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
WHETHER SUCH LIABILITY IS BASED ON WARRANTY, CONTRACT, TORT (INCLUDING
NEGLIGENCE OR STRICT LIABILITY) OR OTHERWISE, AND WHETHER OR NOT SELLER HAS BEEN
ADVISED OF, OR MIGHT OTHERWISE HAVE ANTICIPATED, THE POSSIBILITY OF SUCH LOSSES.
(c) EXCEPT TO THE EXTENT CAUSED BY SELLER'S WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE, BUYER SHALL INDEMNIFY AND HOLD HARMLESS SELLER'S INDEMNIFIED PERSONS
FROM AND AGAINST ANY LOSSES WHICH THE SELLER'S INDEMNIFIED PERSONS MAY SUSTAIN
OR INCUR BY REASON OF ANY CLAIM, DEMAND, SUIT, ACTION, PROCEEDING, INVESTIGATION
OR RECOVERY BY ANY THIRD-PARTY RESULTING FROM ACTS OR OMISSIONS COMMITTED BY OR
ON BEHALF OF SELLER IN PROVIDING THE PRE-CLOSING SERVICES AND TRANSITION
SERVICES OR RESULTING FROM THE USE OF TRADEMARKS.
(d) EXCEPT TO THE EXTENT CAUSED BY BUYER'S WILLFUL MISCONDUCT, GROSS
NEGLIGENCE OR BREACH OF THIS AGREEMENT, SELLER SHALL INDEMNIFY AND HOLD HARMLESS
BUYER'S INDEMNIFIED PERSONS FROM AND AGAINST ANY LOSSES WHICH THE BUYER'S
INDEMNIFIED PERSONS MAY SUSTAIN OR INCUR BY REASON OF ANY BREACH BY SELLER OF
THIS AGREEMENT OR ANY CLAIM, DEMAND, SUIT, ACTION, PROCEEDING, INVESTIGATION OR
RECOVERY BY ANY THIRD-PARTY RESULTING FROM WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE COMMITTED BY OR ON BEHALF OF SELLER IN PROVIDING THE PRE-CLOSING
SERVICES AND TRANSITION SERVICES.
(E) NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY IN THIS AGREEMENT, BUYER
SHALL NOT BE ENTITLED TO RECOVER FROM SELLER ANY LOSSES THAT ARISE OUT OF OR
RELATE TO THE FAILURE OF SELLER TO ACHIEVE ANY PERFORMANCE STANDARD SET FORTH IN
THE SERVICE LEVEL AGREEMENT; PROVIDED, HOWEVER, THAT THIS LIMITATION SHALL NOT
RESTRICT BUYER'S RECOVERY FOR LOSSES THAT ARISE OUT OF THE FAILURE TO ACHIEVE A
SERVICE AVAILABILITY WITH RESPECT TO THE APPLICABLE TRANSITION SERVICES OF AT
LEAST THE SERVICE LEVEL SET FORTH IN THE COLUMN ENTITLED "SERVICE LEVEL FLOOR"
IN SECTION 3.0 OF EXHIBIT 3.1(H), CORRESPONDING TO SUCH TRANSITION SERVICE (THE
"SERVICE AVAILABILITY FLOOR"). IN THE EVENT SELLER FAILS TO ACHIEVE A SERVICE
AVAILABILITY EQUAL TO OR GREATER THAN THE SERVICE AVAILABILITY FLOOR, BUYER'S
ABILITY TO RECOVER FROM SELLER ANY LOSSES ARISING OUT OF SUCH FAILURE TO ACHIEVE
A SERVICE AVAILABILITY EQUAL TO OR GREATER THAN THE SERVICE AVAILABILITY FLOOR
SHALL NOT BE LIMITED BY THIS SECTION 7.2(E).
Section 7.3 Proprietary Information. Buyer and Seller each agree to keep
confidential any and all proprietary information of the other acquired in
connection with this Agreement. For purposes of this Article, "proprietary
information" is information that is not in the public domain,
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
that a party considers to represent a trade secret or business confidential
information, that a party does not disclose to the general public, and where the
disclosing party either has informed the receiving party that the information is
"proprietary information" (as for example by affixing a restrictive legend on a
document bearing proprietary information) or where it is clear from the
circumstances of disclosure to any reasonable business person that the
information has a "proprietary" character (where for example confidential
customer records or financial reports are involved). Each party shall cause each
of its Affiliates and each of their officers, directors, employees, agents,
representatives, successors and assigns to hold all information relating to the
business of the other party disclosed to it by reason of this Agreement
confidential and will not disclose any of such information to any third party
unless (i) such information is part of the public domain other than through
breach of this Agreement by, or through the fault of, the received party or (ii)
such party is legally compelled to disclose such information; provided, however,
that to the extent that either party becomes so legally compelled, such party
may only disclose such information if it shall first have used reasonable
efforts to, and, if practicable, shall have afforded the other party the
opportunity to obtain, an appropriate protective order or other satisfactory
assurance of confidential treatment for the information required to be so
disclosed. Notwithstanding the above, Seller may disclose confidential
information to its employees and third-party subcontractors on a confidential
basis for the purpose of performance of the Transition Services and where such
employees, subcontractors or vendors will treat the proprietary information with
at least the level of confidentiality as here required of the parties. The
parties acknowledge and agree that irreparable injury will result to each of
them, or their respective business and property in the event of a breach by the
other party of this obligation of confidentiality and that each party's remedy
at law for such breach is inadequate and that each party in addition to any
money damages for any such breach shall be entitled to temporary and permanent
injunctive relief.
Section 7.4 Survival. This Article VII shall survive termination or
expiration of this Agreement for any reason.
ARTICLE VIII
REMEDIES; DISPUTE RESOLUTION
Section 8.1 Specific Performance. EACH PARTY ACKNOWLEDGES AND AGREES THAT
THE OTHER PARTY MAY BE IRREPARABLY HARMED IN THE EVENT OF A BREACH OR THREATENED
BREACH OF THE PROVISIONS OF THIS AGREEMENT OR CONTEMPLATED HEREBY, FOR WHICH
DAMAGES, EVEN IF AVAILABLE, MAY NOT PROVIDE AN ADEQUATE REMEDY. ACCORDINGLY, IN
THE EVENT OF A BREACH OR THREATENED BREACH, THE AGGRIEVED PARTY WILL BE ENTITLED
TO (A) AN INJUNCTION, WITHOUT POSTING A BOND, RESTRAINING THE BREACHING PARTY
FROM ENGAGING IN ANY OF THE ACTIVITIES PROHIBITED BY THE AGREEMENT, WHETHER SUCH
ACTIVITIES ACTUALLY HAVE BEEN ENGAGED IN OR ARE THREATENED, AND (B) THE GRANTING
BY ANY COURT OF COMPETENT JURISDICTION OF THE REMEDY OF SPECIFIC PERFORMANCE OF
ITS OBLIGATIONS HEREUNDER.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
NOTWITHSTANDING THE FOREGOING, NOTHING HEREIN WILL BE CONSTRUED AS PROHIBITING A
PARTY FROM PURSUING ANY OTHER AVAILABLE REMEDIES AT LAW OR IN EQUITY FOR SUCH
BREACH OR THREATENED BREACH, INCLUDING THE RECOVERY OF DAMAGES.
Section 8.2 Dispute Resolution.
(a) Any dispute arising under this Agreement shall be settled by
arbitration in Los Angeles, California, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, except as provided in
Section 3.1(i) and (j). It is the intention of the parties that the arbitration
award will be final and binding, shall not be appealable and that a judgment of
any circuit court having jurisdiction thereof may be rendered upon the award,
and enforcement may be had according to its terms. This agreement to arbitrate
shall be specifically enforceable against each of the parties.
(b) When a matter has been submitted for arbitration, within thirty (30)
days of such submission, Buyer will choose an arbitrator and Seller will choose
an arbitrator, and an additional arbitrator independent of the parties will be
selected unanimously by the two (2) arbitrators chosen by the parties. The
dispute shall then be resolved by majority vote of the three (3) arbitrators. If
the arbitrator chosen by Buyer and the arbitrator chosen by Seller cannot agree
upon a third independent arbitrator within thirty (30) days of their
appointment, the independent third arbitrator will be selected according to the
procedures of the American Arbitration Association or any successor to the
function thereof.
(c) The parties hereto agree that an action to compel arbitration pursuant
to this Agreement may be brought in any court of competent jurisdiction.
Application may also be made to any such court for confirmation of any decision
or award of the arbitrators, for an order of enforcement and for other remedies
which may be necessary to effectuate such decision or award. The parties hereto
hereby consent to the jurisdiction of the arbitrators and of such court and
waive any objection to the jurisdiction of such arbitrator and court.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Amendment and Modification. This Agreement and the Attachments
and Exhibits attached hereto may be amended, modified or supplemented only by
written agreement of Buyer and Seller.
Section 9.2 Waiver of Compliance; Consents. Except as otherwise provided
in this Agreement, any failure of any of the parties to comply with any
obligation, covenant or condition herein may be waived by the party entitled to
the benefits thereof only by a written instrument signed by the party granting
such waiver, but such waiver or failure to insist upon strict compliance with
such obligation, covenant, or condition shall not operate as a waiver of or
estoppel with respect to any subsequent or other failure.
Section 9.3 Exhibits and Recitals. All Exhibits referred to herein and all
recitals set forth herein are intended to be and hereby are specifically made a
part of this Agreement.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
Section 9.4 Notices. Except as otherwise provided in the Exhibits hereto
(as to which notice by electronic mail is sufficient to accomplish the
requirement for "notify" or "notification" unless otherwise indicated), any
notice, request, instruction or other document to be given hereunder will be in
writing and delivered personally or sent by registered or certified mail,
postage prepaid, or by facsimile, according to the instructions set forth below.
Such notices will be deemed given: at the time delivered by hand, if personally
delivered; at the time received if sent by registered or certified mail; and at
the time when confirmation of successful transmission is received by the sending
facsimile machine if sent by facsimile.
If to Buyer: U.S TelePacific Corp.
000 Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: President and Chief Executive Officer
Email: xxxxxxx@xxxxxxxxxxx.xxx
With a copy (which will
not constitute notice) to: U.S TelePacific Corp.
000 Xxxxx Xxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Phone:(000) 000-0000
Facsimile: (000) 000-0000
Attention: General Counsel
Email: xxxxxxxxx@xxxxxxxxxxx.xxx
and
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxx
Email: xxxxxxxx@xxxxxxxxxx.xxx
If to Seller: Pac-West Telecomm, Inc.
0000 Xxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxx
Email: xxxxxxxx@xxxxxxx.xxx
With a copy (which will not
constitute notice) to: Jenner & Block LLP
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Xxx XXX Xxxxx
Xxxxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxx
Email: xxxxx@xxxxxx.xxx
or to such other address or to the attention of such other party that the
recipient party has specified by prior written notice to the sending party in
accordance with the preceding.
Section 9.5 Assignment or Subcontracting.
(a) Except as otherwise provided in Sections 9.5(b) and (c), neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned, or any substantial portion of the obligations hereunder shall be
subcontracted by Seller without the prior written consent of Buyer (which
consent shall not be unreasonably withheld).
(b) Notwithstanding Section 9.5(a), and except as otherwise provided in
Section 9.5(c), neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned, or any substantial portion of the
obligations hereunder shall be subcontracted by Seller without the prior written
consent of Buyer (which may be withheld by Seller with or without reason) if:
(i) such assignment or subcontracting arrangement becomes, or is to
become, effective prior to the one hundred fiftieth (150th) day following
the Closing Date and (A) in the good faith reasonable judgment of Buyer,
contemplates that the assignment or subcontracting arrangement would be
made to, or entered into with, as the case may be, a party that does not
have the sufficient financial resources to perform or the technical and
professional capability to perform Seller's obligations under this
Agreement, or (B) contemplates that the assignment or subcontracting
arrangement would be made to, or entered into with, as the case may be, a
party that is a Direct Competitor; and
(ii) such assignment or subcontracting arrangement becomes, or is to
become, effective at any time during the period beginning one hundred
fifty (150) days following Closing and ending three hundred sixty-five
(365) days following Closing, and in the good faith reasonable judgment of
Buyer, contemplates that the assignment or subcontracting arrangement
would be made to, or entered into with, as the case may be, a party that
does not have the sufficient financial resources to perform or the
technical and professional capability to perform Seller's obligations
under this Agreement.
(c) Notwithstanding Sections 9.5 (a) and (b), this Agreement and any of
the rights, interests or obligations hereunder may be assigned, or any
substantial portion of the obligations hereunder may be subcontracted by Seller
without the consent of Buyer if:
(i) such assignment or subcontracting arrangement becomes, or is to
become, effective prior to the one hundred fiftieth (150th) day following the
Closing and such assignment or subcontracting arrangement is made to, or entered
into with, as the case may be, to any third
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
party acquiror or successor who is not a Direct Competitor as a part of a
Non-SME Asset Sale or Controlling Stock Sale that constitutes a Qualifying
Proposal (without regard to the fact that such Non-SME Asset Sale or Controlling
Stock Sale would occur following the end of the exclusivity period contemplated
by Section 5.12 of the Purchase Agreement); and
(ii) such assignment or subcontracting arrangement becomes, or is to
become, effective at any time on or after the one hundred fiftieth (150th) day
following Closing and such assignment or subcontracting arrangement is made to,
or entered into with, as the case may be, to any third party acquiror or
successor as a part of a Non-SME Asset Sale or Controlling Stock Sale that
constitutes a Qualifying Proposal (without regard to the fact that such Non-SME
Asset Sale or Controlling Stock Sale would occur following the end of the
exclusivity period contemplated by Section 5.12 of the Purchase Agreement).
(d) For purposes of this Section 9.5, an assignment shall be deemed to
include any direct or indirect assignment by merger, consolidation, stock
purchase, asset purchase or other sale of Seller or all or substantially all of
the assets of Seller.
(e) Any assignment of this Agreement or any of the rights, interests or
obligations hereunder in contravention of this Section 9.5 shall be null and
void and shall not bind or be recognized by Buyer or Seller. Subject to the
preceding sentences, this Agreement will be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
Section 9.6 Third Party Beneficiaries. Nothing in this Agreement shall be
construed as giving any person other than the parties hereto and their
respective successors and permitted assigns any legal or equitable right, remedy
or claim under or with respect to this Agreement.
Section 9.7 Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other terms, conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in a mutually acceptable
manner in order that the transactions contemplated hereby be consummated as
originally contemplated to the fullest extent possible.
Section 9.8 Governing Law. This Agreement shall be governed by and
construed, interpreted and the rights of the parties determined in accordance
with the laws of the State of California (regardless of the laws that might be
applicable under principles of conflicts of law).
Section 9.9 Counterparts. This Agreement may be executed and delivered
(including by facsimile transmission, with hard copy to follow) in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which, when executed and delivered, shall be deemed to be an original but all
of which taken together shall constitute one and the same agreement.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
21
Confidential Treatment Requested by Pac-West Telecomm, Inc.
Section 9.10 Entire Agreement. This Agreement, each of the Attachments and
Exhibits hereto and any other documents referred to herein collectively
constitute the entire agreement among the parties with respect to the subject
matter hereof and supersede any and all prior or contemporaneous agreements,
understandings or representations by or among the parties, written or oral, with
respect thereto.
Section 9.11 Headings. The descriptive headings contained in this
Agreement are included for convenience of reference only and shall not affect in
any way the meaning or interpretation of this Agreement.
Section 9.12 No Partnership or Joint Venture Created. Each party is and
will remain at all times an independent contractor of the other party in the
performance of all Transition Services hereunder. Except as otherwise provided
herein, no party will have any right, power or authority to create any
obligation, express or implied, on behalf of any other party nor shall either
party act or represent or hold itself out as having authority to act as an agent
or partner of the other party, or in any way bind or commit the other party to
any obligations. Nothing in this Agreement is intended to create or constitute a
joint venture, partnership, agency, trust or other association of any kind
between the parties or persons referred to herein.
Section 9.13 Force Majeure. In the event that Seller is delayed in or
prevented from performing its obligations under this Agreement, in whole or in
part, due to (a) strikes, (b) lockouts, (c) labor troubles, (d) terrorism or
war, whether declared or undeclared and including threat of the same, (e) riot
or civil disorder, (f) acts of God, act, order, regulation or request of
government or other public authorities, (g) embargoes, (h) delays in
transportation, (i) failure of power, (j) restrictive governmental laws or
regulations, whether valid or not, (k) insurrection, (l) fire or explosions or
(m) any other reason other than financial, beyond the reasonable control of such
party, then upon notice to Buyer, (i) the affected provisions and/or other
requirements of this Agreement will be suspended only to the extent necessary
during the period of such disability, (ii) Seller will have the right to
apportion its services in an equitable manner to all users and (iii) Seller will
have no liability to Buyer or any other party in connection therewith.
Section 9.14 Interpretation; No Strict Construction. The language used in
this Agreement will be deemed to be the language chosen by the parties to
express their mutual intent and no rule of strict construction will be applied
against any party. The use of the word "including" in this Agreement means
"including without limitation" and is intended by the parties to be by way of
example rather than limitation. As used in this Agreement, the terms "hereof,"
"hereunder," "herein" and words of similar import will refer to this Agreement
as a whole and not to any particular provision of this Agreement. Each of the
Exhibits and Appendices hereto shall be construed with and as an integral part
of this Agreement to the same extent as if set forth verbatim herein.
Section 9.15 No Conflict. Except as otherwise provided in the immediately
following sentence, in the event of any conflict or inconsistency between the
terms of this Agreement and the terms of the Purchase Agreement, the terms of
the Purchase Agreement will prevail. In the event of any conflict or
inconsistency between the terms of Article VII or Section 3.2 of this
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
Agreement and the terms of the Purchase Agreement, Article VII and Section 3.2
of this Agreement will prevail. Except as provided in the immediately preceding
sentence, nothing contained herein shall be deemed to alter, modify, expand or
diminish the terms of the Purchase Agreement including Seller's obligations
under Article VII of the Purchase Agreement.
Section 9.16 Expenses. Except as otherwise specified in this Agreement,
each of Buyer and Seller will bear their own costs and expenses (including legal
fees and expenses) incurred in connection with this Agreement and the
transactions contemplated hereby, whether or not such transactions are
consummate.
Section 9.17 Compliance with Laws. Each party will comply in all material
respects with all applicable Laws governing the Transition Services to be
provided hereunder. No party will take any action in material violation of any
Law that could result in liability being imposed on the other party.
Section 9.18 Publicity. Neither party shall use the name, logo, trademark
or other symbol of the other party in advertising, publicity releases or
publicly distributed materials, including, but not limited to, references on web
sites, home pages or hypertext links, without securing the prior written
approval of an authorized representative of the other party.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
IN WITNESS WHEREOF, the parties have caused this Transition Services
Agreement to be executed by their duly authorized representatives as of the date
and year first set forth above.
PAC-WEST TELECOMM, INC.
By: ____________________________________________
Name: Xxxxx X. Xxxxxxxxx
Title: President and Chief Executive Officer
U.S. TELEPACIFIC CORP.
By: ____________________________________________
Name: Xxxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
[Signature Page to Transition Services Agreement]
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
EXHIBIT 2.1
NETWORK MANAGEMENT SERVICES
1.0 Basic Obligation
Subject to Section 2.11 of this Agreement, all Network Management Services shall
be performed with a quality of service standard that is consistent in all
material respects with the Network Management Services provided by Seller to its
SME Customers immediately prior to the date of this Agreement (the "Network
Management QoSS").
2.0 Daily Network Maintenance
Seller shall be responsible for maintaining its Network infrastructure as
necessary to provide Services to SME Customers in accordance with the Network
Management QoSS.
3.0 Switch
Seller shall be responsible for maintaining switch equipment and infrastructure
including, but not limited to all hardware, software and peripheral devices, as
necessary to provide Services to SME Customers in accordance with the Network
Management QoSS.
4.0 Voice Mail
Seller shall be responsible for maintaining voice mail equipment, software
licenses and other infrastructure including, but not limited to all hardware,
software (and software licenses) and peripheral devices as necessary to provide
Services to SME Customers in accordance with the Network Management QoSS.
5.0 Data Network and Associated Hardware
Seller shall be responsible for maintaining data (frame relay and asyrchronous
transfer mode ("ATM")) equipment, software licenses and other infrastructure
including, but not limited to all hardware, software (and software licenses) and
peripheral devices as necessary to provide Services to the SME Customers in
accordance with the Network Management QoSS.
6.0 Network and Transport
Seller shall be responsible for maintaining network and transport infrastructure
including, but not limited to hardware, software and peripheral devices, and
inter-carrier agreements, as necessary to provide Services to SME Customers in
accordance with the Network Management QoSS.
6.1 Seller shall be responsible for maintaining each circuit for a SME
Customer from Seller's switch location to the carrier's Network Interface
Unit ("NIU") device in accordance with QoSS. Seller shall be responsible
for trouble-shooting and, where network problems are identified, for
locating where on the network (i.e., on a network segment operated by
Seller, by Buyer or by third party carrier) the problem resides. Seller
shall be responsible for providing customer premise equipment ("CPE")
passwords to Buyer, and Buyer will be responsible for promptly change
passwords upon migration in accordance with the Network Management QoSS.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
6.2 Where a network or transport problem affecting SME Customers is
determined by Seller to on Seller's network facilities beyond the NIU,
Seller shall use commercially reasonable efforts to promptly notify
Buyer's Customer Technical Support Center ("CTSC") and Buyer shall
thereafter be responsible for determining what action to take, and whether
to notify a SME Customer of action required to be taken by the SME
Customer.
6.3 Where a network or transport problem affecting SME Customers is
determined to exist within Seller's network facilities, Seller shall use
commercially reasonable efforts to promptly notify Buyer's Trouble Support
Center and Seller shall be responsible for determining the appropriate
action to take to remedy such problem and to take such action.
6.4 When requested by Buyer or in response to a network alarm, Seller
shall perform remote monitoring and test by performing a test of the SME
Customer's circuit from Seller's switch location to the customer's NIU and
CSU. The test results shall be documented by Seller and stored in the
associated trouble ticket ("MSR").
7.0 SME Customer Affecting Maintenance and Repair
Any SME customer-affecting Method of Procedure ("MOP"), maintenance or repair
with respect to Seller's network facilities must be completed between the hours
of 10:00 p.m. and 6:00 a.m., Pacific time (hereinafter, the "Maintenance
Window") or otherwise during hours approved by Buyer for those activities which
could impact SME Customers. Prior to commencing any MOP, whether scheduled or
required on an emergency or other unscheduled basis, Seller will use
commercially reasonable efforts to promptly notify Buyer's Technical Service
Center to inform Buyer of any scheduled or necessary and planned service prior
to the activity. In such circumstances, the parties shall consult and coordinate
as reasonably necessary as to minimize customer and network impact.
8.0 Network Operations Center (NOC)
Seller, on a 24-hour a day, 7-day a week basis, shall monitor and use
commercially reasonable efforts to respond to network alarms relating to its
network facilities servicing SME Customers (a "Network Alarm") as necessary to
provide continuous and reliable Services in accordance with the Network
Management QoSS to SME Customers in the Market during the Transition Period.
Without limiting the foregoing:
8.1 Seller shall coordinate the restoration of out-of-service conditions
affecting the Services provided to SME Customers and, for such purposes,
shall utilize ILEC, IXC, other carrier, engineering, operations, internal
circuit design and such other resources as reasonably are required.
8.2 Seller shall regularly monitor DS-1 and DS-3 and higher capacity
circuits in Seller's network facilities servicing SME Customers, and shall
monitor all of the network elements and facilities included in its network
facilities servicing SME Customers and employed to connect these circuits
to the SME Customers.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
8.3 If a Network Alarm is determined by Seller to require dispatch of
field technicians, Seller shall use commercially reasonable efforts to
promptly notify Buyer's CTSC (i) by email to address to be established and
provided to Seller prior to Closing; and (ii) via telephone call to
Buyer's (CTSC) Call Center hotline. Buyer shall determine whether to
respond to such notice by dispatch of a field technician and, where so
determined Buyer shall be responsible for the dispatch. If Buyer
determines that a SME Customer should be notified of such Network Alarm or
dispatch, Buyer shall be responsible for such notification.
8.3.1 Seller shall create "Trouble Tickets" using Seller's Trouble
Ticketing System for (a) all Network Alarms indicating SME
customer service impact; (b) all SME Customer's reports of
problems with service; and (c) other network events,
including, without limitation, network outages, customer
degraded events, non-customer affecting degraded events
(network events where redundancy is available). Seller will
use commercially reasonable efforts to promptly notify Buyer
of all events that effect network performance where SME
Customers will be affected at the level of service of 10 DS-1s
or greater. Notification shall be accomplished by an "Outage
Notification" email to Buyer's CTSC Call Center.
8.4 An event ticket or MOP is opened for all planned work on the network,
except in an emergency situation, where Seller is authorized to perform
work as required to respond to the emergency, and to provide notice to
Buyer thereafter. All planned work shall be coordinated through the NOC
and must be performed during the Maintenance Window, unless Buyer
specifically authorizes otherwise. Seller will use commercially reasonable
efforts to promptly notify Buyer of all scheduled and emergency MOP
activity whether categorized as customer affecting or non-customer
affecting. Seller shall report to Buyer on the work actually performed to
respond to the Event ticket and shall identify such work units as were
performed for purposes of pricing and billing where required.
8.5 Seller's NOC shall draft and distribute to Buyer "Trouble and
Root-Cause Analysis Reports," substantially in the form currently used by
Seller on all major outages in Seller's network facilities affecting SME
customers ("Major" defined as 10 DS-1s, or DS-3 and greater).
9.0 Translations
Seller shall manage all applicable routing and customer translations in all
serving switch infrastructure. Translations shall include, but are not be
limited to the following activities:
- Maintain all switch tables that support routing calls to the
proper destination
- Administer area code and prefix expansion (new codes or
changed codes)
- Administer and change area split activity
- Translate area code overlay datafill
- Support IT on all call detail recording issues
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
- Support all messaging for ISUP and CLASS feature activity in
SS7 network
- Coordinate all Global Title Translations for LNP, CNAM, AIN
and enhanced 800 service changes
- Support code administrators on LERG administration and
maintenance
- Provide support for Voicemail system
- Provide tier 2 LNP support for all Seller entities
During the Transition Period, Seller shall continue to perform address
translation functions on an ongoing basis, except to the extent the parties
otherwise may agree on in writing, in order to provide continuing support of the
SME Customers who receive Services through facilities or services provided by
Seller's network.
10.0 Additional Network Capacity
Subject to Section 2.12 of this Agreement, Seller shall manage and augment its
network and transport capacity and infrastructure to ensure that network
capacity shall be sufficient, for the Transition Period, to satisfy SME
Customers currently in the Market, new SME Customers who place In-Flight Orders
and additional SME Customers who may place Post-Closing Orders and for whom
Buyer determines that Seller's network and infrastructure is to be used in order
to provide the Services, in each case, in accordance with the Network Management
QoSS.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
28
Confidential Treatment Requested by Pac-West Telecomm, Inc.
EXHIBIT 2.2
CUSTOMER SERVICES
1.0 Basic Obligation
Subject to Section 2.11 of this Agreement, all Customer Services shall be
performed with a quality of service standard that is consistent in all material
respects with the Customer Services provided by Seller to its SME Customers
immediately prior to the date of this Agreement (the "Customer Service QoSS").
2.0 Repair/Care
Where a SME Customer inquiry, complaint or trouble report indicates there is an
issue or problem with the performance of Seller's network facilities, in some
cases the SME Customer will contact Seller directly or be referred by Buyer or
its agents to Seller. In other cases, however, a SME Customer inquiry, complaint
or trouble report are to be directed and received by Buyer or its agents. In
either event:
2.1 Seller will use commercially reasonable efforts to promptly notify
Buyer when a trouble ticket is opened after receipt of an inquiry,
complaint or trouble report concerning the performance of Seller's network
facilities.
2.2 Where resolution of any problem within Seller's network facilities
requires action by Seller, it will be Seller's responsibility to secure
resolution of such problem and to report to Buyer the problem and the work
steps taken to resolve the problem, in each case as soon as reasonably
practicable following acquiring knowledge of such problem. Seller in all
such cases shall document and record the problem, analysis of problem,
steps taken to secure resolution of the problem, and make available to
Buyer upon reasonable notice such information in electronic form for later
review.
2.3 Seller shall document in reasonable detail the source of the work
requirement and the actual work performed.
3.0 Order Processing
Seller will be responsible to process and provision Customer Orders and to
provide Services in accordance with such Customer Orders in accordance with the
Customer Service QoSS, as set forth below.
3.1 New Orders. Seller shall provision new Customer Orders for Services in
the market solely upon direction from Buyer.
3.2 In-Flight and Post-Closing Orders. Seller shall provision In-Flight
and Post-Closing for Services for SME Customers in the market solely upon
direction from Buyer.
3.2.1 Provisioning shall be performed by Seller as reasonably
directed by Buyer.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
3.2.2 All In-Flight and Post-Closing Orders will be reviewed by
Buyer prior to provisioning. Buyer, at its sole discretion,
may cancel such orders or direct Seller to provision or to
complete the provisioning of the Services that are the subject
of such order(s); provided that Buyer assumes liability for
any order cancellation.
3.2.3 Buyer will enter all Orders using OES or MSR.
3.3 Cancellation of Services Under "Pending Orders". Within fifteen (15)
days of Closing, Seller shall report to Buyer on the existence and terms
of any and all pending orders placed by SME Customers for Services that
have not been completed at the time of Closing. Subject to any obligations
as exist under valid contracts, Buyer may cancel any and all Services
under such pending orders.
3.3.1 Seller shall cooperate with Buyer where Buyer elects to cancel
or replace pending orders. Buyer is responsible for providing
timely and courteous notice to SME Customers and appropriate
explanation of the service decision and (where applicable) of
the alternative of direct service from Buyer.
3.3.2 Seller shall provide to Buyer a weekly report on "Pending
Orders" sufficient to enable Buyer to track and follow-up on
the status of all pending orders, until such time that all
pending orders have been resolved. This "Pending Order Report"
shall be provided to Buyer in electronic format.
3.4 Moves - Adds - Change - Disconnects ("MACD"). Seller shall provision
circuit and network database services for MACD for SME Customers solely
upon receipt of direction from Buyer. Seller shall promptly and
professionally provision the customary network and customer service
functions as necessary per customers request in accordance with the
Customer Service QoSS.
3.4.1 As directed by Buyer, Seller shall continue to perform, during
the Transition Period, MACD functions for SME Customers who
receive Services through facilities or services provided by
Seller's network in accordance with existing process
3.4.2 Buyer has the exclusive authority and responsibility to
respond to customer service calls that seek "port out" or
"disconnect" MACDs. Buyer has sole responsibility for dealing
with customers making such requests and, only upon receipt of
written (or electronic) direction from Buyer, is Seller
authorized to act upon "port out" or "disconnect" requests.
Seller shall follow its current business process for service
cancellation or disconnect requests received from Buyer. Where
instructed by Buyer to process a churn disconnect order,
Seller shall complete the disconnect of
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
network facilities within five (5) business days of receipt of
such instructions or as soon as reasonably practicable
thereafter.
3.4.3 Subsequent to the migration of any SME Customer from Seller's
network facilities to Buyer's network facilities, Buyer
thereafter is exclusively responsible for MACD support and
Seller is relieved of this responsibility.
3.5 Individual case basis orders that are non-standard for Seller will be
completed for Buyer at a time and material charge only if Buyer and Seller
agree upon terms and conditions. In the event such cooperation is
required, the point of contact for Buyer in such matters shall be Buyer
Manager and the point of contact for Seller shall be Seller Manager.
3.6 Change In Provider Affiliation. As directed by Buyer, as existing SME
Customer agreements near expiration or when SME Customers seek new
agreements to revise, expand or change the scope or provisions thereof,
Seller will respond to inquiries regarding such matters by directing the
SME Customer to Buyer and encouraging each such SME Customers to contact
the Sales organization of Buyer in order to sign a new sales contract
agreement with Buyer for a product set offered by Buyer. For
administrative purposes, where such SME Customer enters into a new
agreement with Buyer to replace the former contract with Seller, the "to"
portion of the new order is to be processed as a "New Install" by Buyer
and the "from" order is to be processed by Seller as a "Disconnection of
Service."
4.0 Billing & Support
Subject to the foregoing, upon the Closing, Buyer shall assume Tier 1 call
center accountability for all SME Customers in the Market. Seller is to provide
Customer Service Support for Tier 2 (SSC) and Tier 3 (NIT), when and as
reasonably directed by Buyer. As directed, Seller shall perform actions in
response to Tier 1 customer service inquiries, in such areas (without
limitation) as billing, In-Flight Orders, repair, and so forth in accordance
with the Customer Service QoSS.
As is required from time to time, Buyer will manage escalation procedure issues
for priority handling by the parties. Issues brought by SME Customers to either
Seller or Buyer may be raised by either Party for resolution by executive levels
of the respective companies on an expedited basis. Buyer shall maintain chronics
list, facilitate a weekly call and provide Seller with a weekly updated version.
5.0 Credit and Collections; Customer Disputes
Except as otherwise contemplated in the Purchase Agreement, Buyer is exclusively
responsible, post-Closing, for all credits and collections arising after
Closing. It is the sole responsibility of Buyer to seek collection of any
nonpaying customers after Closing.
After Closing, any disputes arising after Closing with existing and new SME
Customers will be the responsibility of Buyer subject to Buyer's obligations and
Seller's rights under the Purchase Agreement. Seller shall use commercially
reasonable efforts to cooperate in any inquiry or
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
investigation that Buyer may conduct in order to determine how to respond and
whether to resolve any such dispute.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
32
Confidential Treatment Requested by Pac-West Telecomm, Inc.
EXHIBIT 2.3
IT AND BILLING SERVICES
1.0 Basic Obligation
Subject to Section 2.11 of this Agreement, all IT and Billing Services shall be
performed with a quality of service standard that is consistent in all material
respects with the IT and Billing Services provided by Seller to its SME
Customers immediately prior to the Effective Date (the "IT and Billing QoSS").
2.0 Information Technology ("IT") Services and Support
Seller will provide information technology services and support to Buyer as
reasonably necessary to provide the Services to SME Customers, to enable Buyer
to plan for and implement conversion of data (as defined in the Transition Plan)
from format usable on Seller's system into a format compatible with Buyer's
systems, to enable the migration of SME Customers from Seller's facilities to
Buyer's network, and for Buyer to xxxx and collect for Services provided to
Customers, in each case, in accordance with the IT and Billing QoSS.
Without limiting the foregoing, such services and support include the following:
2.1 Usage/call detail data from switches and partners (e.g. Alcatel feeds,
EMI and Sprint) related to the SME Business. Data is required from various
stages of processing: re-formatted/filtered records output from mediation
(after Asuriti), and rated/billed records (relatable to customer
invoices). Data supports SME end customer billing.
2.2 One time audit of usage rules and costs from receipt of switch and
partner data through Asuriti for all (SME and SP) traffic. Personnel from
Buyer and Seller to conduct such audit shall be identified and agree to in
advance. Related Carrier Billing (Carrier Access (MeetPoint), Reciprocal
Compensation will be calculated one-time and billed on a cost estimate
based upon the number of DS-1s remaining on Seller's network.
2.3 SME customer records from the billing and financial systems including
monthly recurring charges, adjustments and payment notices, receivables
aging, contact information, billing and service addresses, account
hierarchies, circuit and telephone numbers, and historical data (as
specified in Initial Transition Plan).
2.4 SME invoices in PDF format for the past 12 months.
2.5 Seller will provide a regular data dump of customer, orders and MSR
data starting at Closing.
2.6 Network inventory detailing customer facilities (e.g. DS-1), the
associated engineering data, and monthly costs. Optionally, network
inventory data associated with non-customer facilities may be required to
support a mutually cost-effective transition.
3.0 Buyer Access
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc.
Seller will provide restricted data access (SME Customer only) to data
maintained on its information technology systems via, among other things, the
Customer Management, Maintenance Service Request, Numbers, intranet voicemail
portal and OES systems. = Access to the intranet applications will be available
during the Transition Period, in accordance with the IT and Billing QoSS.
4.0 Interim Billing Period
Buyer shall assume responsibility for billing and collection from all SME
Customers immediately upon the Closing Date. The parties shall cooperate to
manage billing and collection during the period (the "Interim Billing Period")
that begins on the Closing and concludes on the date that Buyer advises Seller
that it has completed the transition of billing systems and functions. During
the Interim Billing Period, Seller shall take preparatory steps to cause the
name of Buyer, telephone contact numbers and email contact information, for
Buyer, to appear on all invoices and SME Customer communications as is provided
or approved by Buyer. During the Interim Billing Period, the parties also shall
cooperate to evaluate their respective service offerings in order to establish
appropriate guidelines for migration from Seller's service and product suite to
that which may be offered and billed by Buyer. Until such time as the Interim
Billing Period is concluded, Seller shall continue to process invoices to SME
Customers and shall conform to Buyer's instructions, where practical, when
billing issues arise.
5.0 Billing Support
During the Interim Billing Period:
5.1 Usage File Processing. Seller will make customer usage data available
via FTP server to Buyer in the form of re-formatted/filtered records
output from mediation on a regular basis when processed, in a mutually
agreed to format and PDF for all invoices sent on behalf of Buyer going
forward, in each case, in accordance with IT and Billing QoSS.
5.2 Xxxx Cycle. Seller will provide customer billing services to existing
and new SME Customers located in the Market, including product pricing
updates, record collection and processing, and Seller shall correct any
unguided usage and re-post, perform, call rating, conduct billing file
production, perform printing, mailing and xxxx remittance functions, in
each case, in accordance with the IT and Billing QoSS.
5.3 Special Processing. At Buyer's direction, Seller will continue to
support special processing for some customers that include CD-ROM based
billing, customer usage detail, credit card payment processing for
existing customer, and any other special SME Customer arrangements that
have been previously agreed to, in each case, in accordance with IT and
Billing QoSS.
5.4 General Ledger Transactions. General ledger transactions summarizing
billing activities in the format currently captured in Seller's existing
process in accordance with IT and Billing QoSS.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
34
Confidential Treatment Requested by Pac-West Telecomm, Inc
5.5 Print and Mail Identification of Buyer. Seller agrees to work with its
existing Print and Mail service provider and Buyer to print and mail the
customer invoice in accordance with IT and Billing QoSS.
5.6 Payment Management. Seller agrees to send payment data to Buyer.
Additionally, Seller agrees to forward all collected payments, to the
extent received, no less frequently than on a weekly basis (Friday) via
wire transfer. Buyer agrees to provide Seller payment feed updates
including payments, finance charges, credits and adjustments on a daily
basis.
5.7 Buyer Stock. Seller will be provided a supply of Buyer's paper stock,
letterhead, images of the company's logo and all other resources and
materials necessary to conduct printing, mailing and xxxx remittance
functions and invoice production.
6.0 Reports
Seller is to provide Buyer with management reports shown in the report schedule
Exhibit 3.1(g) to assist with the transition of services to Buyer's
responsibility during the Transition Period. Seller shall continue to provide
such reports, unless the parties mutually agree to changes to their form or
content, during the Transition Period hereof. Any Seller reports requested by
Buyer not available today will be billed for development time to create the
report and recurring costs to produce the report at the loaded IT labor rate.
7.0 Miscellaneous Support
Seller is to provide Buyer with the following additional Services in accordance
with the Customer Service QoSS.
- Conversion Support.
To adapt existing systems specified in Section 4.0 hereof, and
in support of the billing data migration, IT will provide
necessary resources.
- Help Desk Support.
Seller will provide Help Desk support services in the event
that a Buyer's employee requires support when utilizing
Seller's systems.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 2.4
NETWORK RELATED SERVICES
1.0 Basic Obligation
Subject to Section 2.11 of this Agreement, Seller agrees to provide Network
Related Services in accordance with a quality of service standard that is
consistent in all material respects with the Network Services provided by Seller
to its SME customers immediately prior to the Effective Date.
2.0 Network Related Services
Network Related Services are comprised of the following:
- Customer end loops
- ILEC Other Charges and Credits applicable to circuit
(Excluding Termination Charges)
- Trunking associated with originating traffic
- Resale POTS
- Enhanced Extended Links ("EELS")
- DS-3 transport carrying SME business
- Allocated portion of DS-3s that carry SME business mixed with
Seller's other line of business (1/28th cost for every DS-1 of
a DS-3 in use)
- Allocated portion of SONET Node Fees associated with DS-3s
- Allocated Direct Internet Access ("DIA")
- Directory Assistance ("DA")
- Calling Card
- Local Number Portability ("LNP") dips and other related costs
- Calling Name ("CNAM")/Line Information Data Base ("LIDB")
- Directory listing/Yellow Pages
- SMS access and access
- 911
- IXC terminating usage ("CABS")
- Local (zone 1, 2, 3) usage
- IntraLata Toll usage
- IntraState usage
- Other InterState usage - Domestic
- Inbound 8XX
- InterLata/InterState 8XX
- InterLata/IntraState 8XX
- IntraLata 8XX
- International usage
- 8XX enhanced features (i.e. time of day routing) - MRC related
- Reciprocal Compensation
- Operator Services
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
- Payphone Surcharges
- IRU Circuits
3.0 Other Network Related Services
In the event Buyer or Seller identifies, at any time during the Transition
Period, any network facilities or services necessary to provide Services to SME
Customers that are not set forth on Exhibit 2.4, Buyer shall pay the amount of
Seller's cost for such services (including, without limitation, for any such
services Seller has previously provided or caused to be provided during the
Transition Period) as invoiced pursuant to Section 3.1(f) of this Agreement;
provided Seller's cost for such services shall be determined in accordance with
Exhibit 3.1(d) and provided further that Buyer's obligations pursuant to this
Section 3.0 shall be subject to the following limitations:
Maximum Obligation of Buyer
under this Section 3.0 for
Calendar Days Other Network Related
Following Closing Services Provided by Seller
0 through 90 [**]/month
91 through 180 [**]/month
181 and thereafter [**]/month
This Section 3.0 shall not apply to services that are not set forth on Exhibit
2.4 as a result of such services not being primarily related to the SME Business
as of the Closing but which become primarily related to the SME Business during
the Transition Period.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
37
Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 2.5
REAL ESTATE SERVICES
1.0 Seller shall make available to Buyer the real estate listed in Section 2.0
below for the time periods listed in Section 3.0 below, subject only to the
consent of the landlord, to the extent that such consent is required, and entry
into a Sub-Lease in form reasonably satisfactory to Seller, Buyer, and, if
necessary or desirable, the applicable landlord. Seller agrees to use
commercially reasonable efforts to encourage and cause the landlord of each such
location to consent to such Sublease.
2.0 Real Estate Summaries
1. Seller's sales office located at 0000 Xxxxxxx Xxxx Xxx, Xxxxx 000,
Xxxxxxxxxx, Xxxxxxxxxx.
2. Seller's sales office located at 0000 X. Xxxxx Xxxx, Xxxxxx 000, 150 and
190, Stockton, California.
3. Seller's sales office located at 0000 Xxxxxxxx Xxxxxx, Xxxxx X & X,
Xxxxxxxx, Xxxxxxxxxx.
4. Seller's sales office located at Napa Xxxxxx Xxxxxxx #0, Xxxxx 000, Xxxx,
Xxxxxxxxxx.
3.0 Term
Seller shall make available the leases relating to Venture Oaks Way, Coronado
Avenue and Napa Valley Gateway, as identified in Section 2.0 above, until
expiration of their respective current terms. With respect to the W. March Lane
property, Seller shall make the property available to Buyer for 6 months, with a
right to a 90-day extension, subject to 90 days prior notice to Seller.
4.0 Notwithstanding anything else to the contrary in this Agreement, once a
Sub-Lease is accepted by Buyer, it is not terminable or otherwise cancelable,
except as otherwise provided in such Lease, Sub-Lease or License.
5.0 Unless and until such a Sub-Lease is entered into, the following terms
shall apply as between Buyer and Seller to the extent that, at or prior to the
Closing Date, Buyer, in its sole and absolute discretion, decides to use the
applicable property (or portion thereof) set forth in Section 2.0:
(a) Buyer shall reimburse Seller pursuant to the Real Estate Services
Pricing Schedule set forth on Exhibit 3.1(e).
(b) Seller shall use commercially reasonable efforts to secure space
used by Buyer via programming Card Access System in a manner that limits access
to a list of associates provided
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
to Seller. At those locations not secured via Buyer's Card Access System, Buyer
shall provide Seller with keys milled in a manner that ensures access to
associates approved by Buyer.
(c) Seller shall use commercially reasonable efforts to ensure that all
furniture & fixtures associated with the SME Business are secured and made
available without delay, so as to avoid any service or operational delays.
(d) Buyer shall conduct business in a professional manner and in
compliance with all applicable laws, acts and/or standards.
(e) Seller shall use commercially reasonable efforts to provide Buyer
with data and voice telecommunications services at properties utilized by Buyer.
Buyer shall reimburse Seller for all voice and data telecommunications services
that Seller provides to Buyer pursuant to the pricing set forth on Exhibit
3.1(e). Seller shall provide Buyer with billing detail supporting all charges.
Seller shall facilitate the installation of dedicated transport facilities that
Buyer may require. Any and all costs associated with the installation of
dedicated transport facilities shall be the sole responsibility of Buyer.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
39
Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 2.6
MIGRATION SERVICES
1.0 Basic Obligation
Subject to Section 2.11 of this Agreement, Seller shall, based upon orders
entered in the order management system (OES), use commercially reasonably
efforts to support the migration of SME customers from Seller's network to
Buyer's network in a timely manner.
2.0 Detailed Customer records/research
Seller shall provide record review, research, and, if necessary, corrections for
each migration order. The outcome of this activity will include:
- Circuit inventory for the SME Customer being migrated
- Cross-reference circuit ID to FS records
- Cross-reference FS records to customer account
- Numbers list for the SME Customer (including TN, DID, Toll
Free, Calling Card)
- Features associated with each number
Such information will be added to the OES order or otherwise communicated to
Buyer.
3.0 Prepare numbers for LNP
Buyer will prepare and submit Local Number Portability ("LNP") port out requests
services on all numbers associated with the migration order. Seller will release
the associated numbers and obtain Firm Order Commitment dates ("FOC dates") and
communicate such results to Buyer.
4.0 Disconnect of switch translations and database
Seller will delete all switch translations associated with the circuit ID and
update necessary records for each migration order upon Buyer's written request.
5.0 Disconnect LEC Facilities
Seller will prepare and submit a disconnect request for LEC facilities for each
migration order using Buyer's requested disconnect date. FOC dates will be
procured by Seller and communicated to Buyer. As a strict performance metric,
Buyer and Seller will consider such circuits disconnected within (5) five
business days of the requested disconnect date.
6.0 Release of DS-3 Facilities
When Buyer determines that all SME Customers on a specific DS-3 circuit have
been migrated, Buyer will instruct Seller to release the DS-3 facility. While
Seller has the option to retain or disconnect any DS-3 facility, Seller will
cease billing Buyer for said circuits within (5) five business days (unless the
carrier has a longer notification window, in which case, Seller has until such
later date) of the later of the requested release date or actual release date.
7.0 Limitation on Migration of DS-1s
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
40
Confidential Treatment Requested by Pac-West Telecomm, Inc
Notwithstanding anything else to the contrary in this Agreement, Seller shall
not be obligated to migrate more than 400 DS-1s in any thirty (30) day period
("Migration Cap").
Seller will provide an additional 10% capacity under condition the no In-Flight
Orders or Post Closing Orders are being processed during any thirty (30) day
period.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
41
Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 2.7
PRE-CLOSING SERVICES
1.0 Seller will assist Buyer in its development and implementation of
the Transition Plan for the migration of SME Customers from Seller's Network
Facilities to network facilities owned or provisioned by Buyer.
2.0 Seller will provide the following additional Pre-Closing Services:
2.1 Real Estate Services - Moving future Buyer personnel or enhancing
space prior to close.
2.2 Security System - Changes in security system or issuing new security
passes.
2.3 Systems Enhancements - Changes in systems to allow Buyer access to
Seller's systems on a segmented basis.
2.4 Access Permissions - Including but not limited to VPN accounts,
System Access and User Administration.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
42
Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(a)
NETWORK MANAGEMENT SERVICES PRICING
1.0 General Principles
Buyer shall pay Seller the amounts specified in the Pricing Schedule set forth
in Section 2.0 for all Network Management Services identified thereunder and
performed by Seller under the terms of this Agreement. In addition, Buyer shall
reimburse Seller at Seller's cost (such cost to be agreed to by Seller and Buyer
(Buyer's agreement not to be unreasonably withheld)) for all Network Management
Services not specifically identified in the Pricing Schedules set forth in
Section 2.0 but performed by Seller under the terms of this Agreement.
2.0 Pricing Schedule*
DESCRIPTION OF SERVICE PRICE PER MONTH
---------------------- ---------------
NETWORK CAPACITY Seller's Time and Material at
- Network capacity will be executed and tracked as a Cost pursuant to Buyer's prior
project with required approval from Buyer. written approval (such cost to
- Project estimates are non-binding. be agreed to by Seller and
- Resources must track their time and submit project Buyer (Buyer's agreement not
timesheet on a weekly basis. to be unreasonably withheld))
PRICING BASE ON NUMBER OF DS-1s AT 1ST OF THE MONTH
- Greater than 2500 DS-1s [**]
- Less than or equal to 2500, but greater than 2000 DS-1s [**]
- Less than or equal to 2000, but greater than 1500 DS-1s [**]
- Less than or equal to 1500, but greater than 1000 DS-1s [**]
- Less than or equal to 1000 DS-1s [**]
NETWORK MONITORING (NOC) Included
- Monitor network circuits and equipment and respond to
alarms.
TIER III (NIT) Included
- Provide appropriate support to Tier II (SSC), NOC and
other organizations to resolve customer and network
related issues.
ENGINEERING AND PLANNING Included
- Maintain Network capacity, support LERG changes,
manage network trunking, support groom activity.
CENTRAL OFFICE Included
- Maintain CO equipment, support repair, provisioning
and migration activity.
* The prices listed in the Pricing Schedule under the column entitled "Price Per
Month" represent the maximum dollar amount that Buyer will pay for services
listed in the column entitled "Description of Services." Any fixed amounts set
forth in the Pricing Schedule shall be pro-rated in the first calendar month of
the Transition Period for the actual number of days in such month Transition
Services are provided.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
43
Confidential Treatment Requested by Pac-West Telecomm, Inc
3.0 Reconciliation Process
Buyer and Seller will agree, in writing, upon the number of SME Customer DS-1
circuits in Seller's network facilities on the last calendar day of month. That
number will be used to verify the above costs for the next calendar month.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
44
Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(b)
CUSTOMER SERVICES AND MIGRATION SERVICES PRICING
1.0 General Principles
Buyer shall pay Seller the amounts specified in the Pricing Schedule set forth
in Section 2.0 for all Customer Services and Migration Services identified
thereunder and performed by Seller under the terms of this Agreement. In
addition, Buyer shall reimburse Seller at Seller's cost (such cost to be agreed
to by Seller and Buyer (Buyer's agreement not to be unreasonably withheld)) for
all Customer Services and Migration Services not specifically identified in the
Pricing Schedules set forth in Section 2.0 but performed by Seller under the
terms of this Agreement.
2.0 Pricing Schedule*
DESCRIPTION OF SERVICE PRICE PER MONTH
---------------------- ---------------
REPAIR/CARE
- Greater than 2500 T1s [**]
- Less than or equal to 2500, but greater than 2000 T1s [**]
Less than or equal to 2000, but greater than 1500 T1s [**]
- Less than or equal to 1500, but greater than 1000 T1s [**]
Less than or equal to 1000 T1s [**]
Volumes exceeding 15% of forecast [**]
PROVISIONING/MIGRATION
First 4 months of Transition Period [**]
[**]
Month 5 and beyond:
Greater of Migration Services forecast** or the number [**]
of migration orders (Migration Services) actually
performed rounded up to the nearest 10. [**]
* The prices listed in the Pricing Schedule under the column entitled "Price Per
Month" represent the maximum dollar amount that Buyer will pay for services
listed in the column entitled "Description of Services." Any fixed amounts set
forth in the Pricing Schedule shall be pro-rated in the first calendar month of
the Transition Period for the actual number of days in such month Transition
Services are provided.
** Migration Services Forecast can be decreased every month, but cannot be
increased.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
45
Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(c)
IT AND BILLING SERVICES PRICING
1.0 General Principles
Buyer shall pay Seller the amounts specified in the Pricing Schedule set forth
in Section 2.0 for all IT and Billing Services identified thereunder and
performed by Seller under the terms of this Agreement. In addition, Buyer shall
reimburse Seller at Seller's cost (such cost to be agreed to by Seller and Buyer
(Buyer's agreement not to be unreasonably withheld)) for all IT and Billing
Services not specifically identified in the Pricing Schedules set forth in
Section 2.0 but performed by Seller under the terms of this Agreement.
2.0 Pricing Schedule
DESCRIPTION OF SERVICE PRICE PER MONTH
IT SERVICES AND SUPPORT FOR Included
DATA MIGRATED AT CLOSE
BUYER ACCESS Communications portion is included in Real Estate (Exhibit
3.1(e)) and system modification portion is included in
Miscellaneous Support (see below)
INTERIM BILLING PERIOD Included
Usage File Processing - Greater than 2500 DS-1s-[**]/month
Automated Usage Feed - Less than or equal to 2500, greater than 2000 DS-1s -
Error Processing [**]/month
Usage Inquiries - Less than or equal to 2000, greater than 1500 DS-1s -
[**]/month
- Less than or equal to 1500, greater than 1000 DS-1s -
[**]/month
- Less than or equal to 1000, greater than 500 DS-1s -
[**]/month
- Less than or equal to 500 DS-1s - [**]/month
BILLING SUPPORT [**]/month
Xxxx Cycle
Xxxx Cycle Quality Assurance Based on the assumption of:
Special Processing - 1 FTE required to manage data feeds between systems (Prep
function)
- 1 FTE from the IT organization to support the process
- 3 FTE required to perform the QA function
- 3 FTE required to perform xxxx production (apply credits,
memos, and run billing cycle, Special processing)
CARRIER BILLING Carrier Billing Costs are to be determined by Seller and Buyer in
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
accordance with Exhibit 2.3 and Section 2.2. Once costs are
determined, the monthly cost will be calculated based on the
following formula:
Carrier Billing Costs (DS-1 Remaining/Total DS-1 at Close)
BILLING SUPPORT Print and Mail is billed at Cost (estimate is $14K/month)
Print and Mail
PAYMENT MANAGEMENT
- Month One [**]
- Month Two [**]
- Month Three [**]
- Months Four and beyond [**]
REPORTS As requested. Refer to Exhibit 3.1(g) for pricing list.
MISCELLANEOUS SUPPORT Seller's Time and Material at Cost pursuant to Buyer's prior
Conversion Support written approval (such cost to be agreed to by Seller and Buyer
(Buyer's agreement not to be unreasonably withheld))
(The parties acknowledge that the current estimate for planning
purposes is approximately [**] to prepare various systems in
support of the Transition Services Agreement and provide billing
system conversion support.)
MISCELLANEOUS SUPPORT [**]/ticket (MSR).
Help Desk Support
Estimate 2 tickets per day in the first 2 months. After this initial
period, we estimate 2 per week.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
47
Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(d)
NETWORK RELATED SERVICES PRICING
1.0 General Principles
1.1 Buyer shall reimburse Seller for all Network Related Services as Seller's
cost. In addition, Buyer shall pay Seller a monthly administrative fee in
respect of Network Related Services equal to [**]/month with a maximum total of
[**]. In addition, Buyer shall reimburse Seller at Seller's cost for all Network
Related Services performed by Seller under the terms of this Agreement.
1.2 When determining Seller's costs for Network Related Services, the parties
agree that the amount of carrier switched access and reciprocal compensation
revenue allocable to SME Customers in respect of a period within the Transition
Period shall be applied as a credit. The formula used to determine the revenue
shall be equal to [**].
1.3 The parties agree that all termination liabilities associated with any DS-3
in service of SME Customers added to Seller's network facilities on or following
the Closing Date (a "Post-Closing DS-3") shall be the responsibility of Buyer
provided that Seller has received prior written approval from Buyer (at Buyer's
sole and absolute discretion) to add such a DS-3 to Seller's network facilities.
1.4 The parties agree that Seller's costs in respect of any Pre-Closing SME DS-3
or Post-closing SME DS-3 with a network segment riding on Pac-West's IRU (Qwest
OC-48 network) shall be fixed monthly cost of at [**] per DS-3.
1.5 Seller shall be responsible for reconciling and filing disputes associated
with any of these services. On a monthly basis, Seller shall provide Buyer an
inventory list for the Network Related Services for the purpose of
reconciliation. The inventory list should include vendor, circuit id, monthly
recurring cost, non-recurring cost, billing account number ("BAN"), and customer
name. Seller shall provide the report after all the monthly invoices for the
given month have been reconciled.
1.6 For usage related costs, Seller will provide supporting usage data. This
data will include cost such as Local (zone 1, 2, 3), IntraLata toll, IntraState
toll, InterState toll, International, all 8XX traffic, DA, reciprocal
compensation, calling card, and IXC terminating (CABS billing). Seller will
provide Buyer with the supporting usage data.
1.7 After the Closing, Seller shall provide Buyer with a current SME Business
related dispute report by vendor, BAN, dollar amount paid or withheld with
respect to such dispute, whether it is a non-recurring or recurring amount, and
the reason for dispute on any Services. Seller shall maintain the report and
update accordingly, as disputes are resolved. Seller will provide this report to
Buyer monthly along with the inventory list. To the extent Seller has withheld
payment of any amounts invoiced by any vendor or carrier with respect to Network
Related Services provided during the Transition Period,
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
48
Confidential Treatment Requested by Pac-West Telecomm, Inc
such withheld amounts will reduce dollar-for-dollar the amount payable by Buyer
in respect of such Network Related Services pursuant to Section 3.1(a) of this
Agreement; provided, however, if Seller subsequently makes payment of all or any
portion of such withheld amounts, Seller shall be entitled to include the full
amount of such payment in the amounts payable by Buyer pursuant to Section
3.1(a). Seller retains rights to any credits obtained for disputes for services
provided prior to the Closing Date, whether discovered before or after the
Closing Date.
1.8 Seller and Buyer will work collectively to determine a blended rate
associated with each of the following usage types: Local (zone 1, 2, 3),
IntraLata toll, IntraState toll (will include allocation of FG-D costs),
InterState toll (will include allocation of IXC trunking costs), and all 8XX
traffic. The suggested method of calculating the blended per minute rate is
taking three months of cost data for each of the categories and divide by the
total number of minutes for the same time period. The rates determined will be
the blended rate per minute applied moving forward for each of the listed
categories. Costs associated with trunking for originating traffic will be
recovered in the usage rate associated with such traffic.
1.9 Buyer and Seller have agreed on the methodology for allocating DIA fees
because this service supports all Seller's lines of business. The calculation to
allocate these costs is taking total DS0 multiplied by 64 kilobits multiplied by
allocated cost per meg, $8/meg. (DS0 X 64 X AVG. COST PER MEG)
1.10 Buyer and Seller have agreed upon a methodology for allocating the costs
associated DS-3s carrying SME business mixed with Seller's other line of
business. The calculation of the number of SME DS-1s will be based on the number
of SME DS-1s riding on the DS-3s. For example, if 1 SME DS-1 was riding a DS-3
with Sellers other lines of business the costs would be 1/28th of the cost of
the DS-3.
1.11 At Closing, Seller will determine the costs associated with providing
services to SME customers using Seller's SONET services. SONET services are used
to connect DS-3s to wirecenters. Buyer and Seller have agreed that the
associated node charge per DS3 will be 1 over the Closing Date fill rate on the
associated SONET terminal time the monthly Ring Fee Charge. (1/(Close Date Fill
Rate)*Ring Fee)
1.12 Buyer and Seller will collectively determine how CNAM/LIDB and LNP query
charges will be allocated for the SME line of business.
2.0 Reconciliation Process
2.1 Before or upon Closing, Seller shall provide Buyer, via commercially
reasonable efforts, a SME Circuit Inventory, which will constitute the circuit
inventory purchased/baseline including mileage. Because of new monthly activity,
disconnects and new installs, the circuit inventory will change accordingly.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
49
Confidential Treatment Requested by Pac-West Telecomm, Inc
2.2 For non-usage related costs, reconciliation will be done monthly against the
prior month's inventory list. These costs include services associated with
customer end loops, resale POTs, EELS, and DS3DS-3 transport carrying SME
Business only.
2.3 Monthly, Seller will provide Buyer a detailed list of all new installs,
additions and disconnects, by vendor, along with an updated inventory list.
Seller will compare the previous months' inventory to the current month;
disconnects/additions/new installs will be subtracted or added accordingly. This
process will allow Buyer to keep track of the inventory purchased as well as
transport services supporting the SME business.
2.4 For usage related costs, Buyer will reconcile the records received from
Seller and determine if the costs are reasonable. These costs will be associated
with Local (zone 1, 2, 3), IntraLata toll, IntraLata/IntraState,
InterLata/IntraState, InterLata, International, all 8XX traffic, reciprocal
compensation, calling card, operator services, and IXC terminating (CABS
billing). Seller will reasonably provide Buyer with the supporting usage data.
2.5 Operator Services, Directory Assistance, and Calling Card usage are related
to SME Business, and therefore Buyer will pay Sellers costs for these three
vendors.
2.6 911-related costs will be applicable to In-Flight Orders.
2.7 Buyer is not responsible for any additional circuit costs incurred as a
result of a disconnect request not being completed within the agreed timeframes,
unless Buyer is directly responsible for the delay.
2.8 Seller will provide 8XX enhanced feature costs to Buyer by 8XX number,
Customer Name, related feature(s), and monthly recurring cost.
2.9 Seller will provide Directory Listing costs by vendor, by customer for the
SME Business only.
2.10 Buyer shall be responsible for the monthly billing on IXC terminating
traffic until such time as Buyer migrates this traffic.
2.11 For any disputes filed against the Transition Services, Seller shall
provide Buyer a monthly dispute report with the following data: Vendor, BAN,
dispute amount, reason for dispute, and whether the amount was paid or withheld
from payment
2.12 Seller shall be responsible for managing and bringing closure to these
disputes within a reasonably timely manner.
2.13 Seller shall maintain and update the reports monthly. As disputes are
closed, the report should reflect date resolved or denied, credit amount
received, and if denied, the reason for denial.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
2.14 Buyer and Seller shall perform a monthly Circuit Reconciliation Audit and
Buyer to Seller Network Related Services Billing Review.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(e)
REAL ESTATE SERVICES PRICING
1.0 General Principles
Buyer shall pay Seller the amounts specified in the Pricing Schedule set forth
in Section 2.0 for all Real Estate Services identified thereunder and performed
by Seller under the terms of this Agreement. In addition, Buyer shall reimburse
Seller at Seller's cost (such cost to be agreed to by Seller and Buyer (Buyer's
agreement not to be unreasonably withheld)) for all Real Estate Services not
specifically identified in the Pricing Schedules set forth in Section 2.0 but
performed by Seller under the terms of this Agreement.
2.0 Pricing Schedule
DESCRIPTION OF SERVICE PRICE PER MONTH
---------------------- ---------------
REAL ESTATE At cost by location
DATA NETWORK (DATA ADVANTAGE) At cost by location through Transition Period At market
rates after the Transition Period
VOICE SERVICES (FBDT) At cost by location through Transition Period At market
rates after the Transition Period
3.0 Reconciliation Process
3.1 Real Estate costs will match with each lease/sublease or other
arrangement document.
3.2 Voice and Data Network services cost will match services contract.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(f)
PRE-CLOSING SERVICES PRICING
1.0 General Principles
Buyer shall pay Seller the amounts specified in the Pricing Schedule set forth
in Section 2.0 for all Pre-Closing Services identified thereunder and performed
by Seller under the terms of this Agreement. In addition, Buyer shall reimburse
Seller at Seller's cost (such cost to be agreed to by Seller and Buyer (Buyer's
agreement not to be unreasonably withheld)) for all Pre-Closing Services not
specifically identified in the Pricing Schedules set forth in Section 2.0 but
performed by Seller under the terms of this Agreement.
2.0 Pricing Schedule
All services provided at Time and Material costs.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(g)
REPORTS SCHEDULE PRICING
1.0 General Principles
Buyer shall pay Seller the amounts specified in the Pricing Schedule set forth
in Section 2.0 for all Reports delivered by Seller to Buyer under the Agreement.
In addition, Buyer shall reimburse Seller at Seller's cost (such cost to be
agreed to by Seller and Buyer (Buyer's agreement not to be unreasonably
withheld)) for all reports not specifically identified in the Pricing Schedules
set forth in Section 2.0 but performed by Seller under the terms of this
Agreement.
2.0 Pricing Schedule
REFERENCE TO TSA DESCRIPTION FREQUENCY COST
----------------------------- -------------------------------------------- --------------------------- ----
Fee Floor - Reports [**]
Network Management Services #1 Initial Circuit List Immediate [**]
#2 COGS Report detailing customer facilities none [**]
and costs
#3 Service Availability Report Monthly [**]
#4 Outage Report Per Event or Monthly Report [**]
#5 MOP Report Per Event [**]
#6 Root Cause Analysis Report Per Event [**]
Customer Services #7 Pending Orders Report Weekly [**]
#8 Service Turn Up Report (STUD) Report Weekly [**]
#9 Complete Orders Report (Gone to Billing) Weekly [**]
#10 Accounts Receivable Aging Report Daily [**]
IT and Billing Services #11 SME CABS and Recip. Comp. Data Feed with Immediate & Weekly [**]
General Ledger Information
#12 PDF SME Customer Records from Billing Close of Xxxx Cycle [**]
system
Network Related Services #13 COGS Payment Report For SME Related Monthly [**]
Network Inventory Costs
#14 Fraud Report for SME Events Per Event [**]
#15 SME Vendor Disputes Report Monthly [**]
#16 Buyer Seller Dispute Report Monthly [**]
#17 SME Usage Related Costs Report Close of Xxxx Cycle [**]
#18 FBDT & DDTS Traffic Report Weekly [**]
Migration Services NA NA [**]
Real Estate Services NA NA [**]
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 3.1(h)
SERVICE LEVEL AGREEMENT
1.0 General Principles
Except as otherwise provided below, Seller agrees that Buyer shall be entitled
to the discount to the pricing established in Exhibits 3.1(a) through (e) for
the Transition Services, in each case, identified in the table set forth in
Section 3.0 below in connection with actual performance results by Seller that
fail to meet the performance objectives set forth opposite each such Transition
Services in the table set forth in Section 3.0 below.
Notwithstanding the foregoing, Buyer shall not be entitled to any discount in
accordance with this Service Level Agreement to the extent Seller's failure to
meet a performance objective in the table set forth in Section 3.0 below is
primarily as a result of inadequate provisioning, planning or preparation by
Seller where such provisioning, planning or preparation was generally consistent
with the provisioning, planning or preparation set forth in, or required by, the
Forecast Report, the Transition Plan or the Migration Plan, or otherwise agreed
or consented to or otherwise acknowledged as appropriate by Buyer. In addition,
if Buyer is the primary cause of Seller not meeting a Service Level Commitment
in an specific area than no discount will apply for that area during such
period.
During the Transition Period, the table set forth in Section 3.0 shall be
utilized using the Standard Percent Discount per Area. Notwithstanding the
foregoing, if Seller assigns any of its rights, interest or obligations under
this Agreement or any substantial portion of the obligations under this
Agreement are subcontracted, in each case, to a Direct Competitor, Buyer shall
be entitled to the discount to the pricing established in Exhibits 3.1(a)
through (c) for the Transition Services, in each case, identified in the table
set forth in Section 3.0 using the Assigned Percent Discount per Area.
Buyer shall not be entitled to a discount to the pricing established in Exhibits
3.1(a) through (e) under the Service Level Agreement until completion of the
first full calendar month following Closing. During the calendar month
immediately following such month, Buyer shall be entitled to a discount to the
pricing established in Exhibits 3.1(a) through (e), to the extent Seller's
performance provides such right, only in the amount of 50% of the amount
otherwise determined under the Service Level Agreement. Thereafter, Buyer shall
be entitled to a discount to the pricing established in Exhibits 3.1(a) through
(e), to the extent Seller's performance provides such right, at the full amount
determined under the Service Level Agreement.
2.0 Update Prior to Closing.
Buyer and Seller shall review the Quality Survey metric prior to Closing and
Seller shall have the right to remove the metric from the Service Level
Agreement prior to Closing. In the event Seller agrees to retain the Quality
Survey metric, the Quality Survey metric shall have a fixed weight of 10%.
Immediately prior to Closing, after providing prior written notice thereof to
Seller, Buyer shall in good faith set the values under the column headed
"Weight" in the Service Level Agreement.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
3.0 Service Level Agreement
Capitalized terms used in this Service Level Agreement are defined in Section
4.0. As a general matter, the applicable discount to the pricing established in
Exhibits 3.1(a) through (e), which Buyer could be entitled to under the Service
Level Agreement, is determined by multiplying the weight by the Percent Discount
per Area applicable to a particular service item and performance threshold.
SERVICE LEVEL AGREEMENT
SERVICE
PERCENT DISCOUNT PER LEVEL REQUIREMENT
AREA WEIGHT AREA FLOOR OR COMMENT
------------------- ------ ---------------------------- -------- ----------------------
STANDARD 10% 20% 30%
ASSIGNED 10% 30% 60%
NETWORK MANAGEMENT
Svc Avail 100% <97% <95% <90% <75%
OOS > 5 Days NA NA NA NA $500/T1
CUSTOMER SERVICE Subject to with
AND MIGRATION forecast by 15%
MTTR OOS 20% <60% <50% <40% <20% Min 10 MSRs
< 4 hours
MTTR SA 10% >50 hrs >60 hrs >70 hrs Min 20 MSRs
MACD - 10% <85% <75% <60% Min 10 orders
Provisioning OES and MSR activity
Activity only
Excludes
% less than 3 augments
days requiring T1s Bus days
MACD - 10% <85% <75% <60%
Network
Database
Service
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
SERVICE LEVEL AGREEMENT
SERVICE
PERCENT DISCOUNT PER LEVEL REQUIREMENT
AREA WEIGHT AREA FLOOR OR COMMENT
------------------- ------ ---------------------------- -------- ----------------------
% less than 5
days
Quality Survey 10% < N% < N-2% < N-5% Establish 2 month
average as base,
subtract 3% for N.
MIGRATION Subject to Migration Cap
LSR/Records 20% > N days > N+1 days > N+2 days Establish 3 month
average as base, add
10% for N, Bus Days
LNP Port On 20% > 2% > 3% > 4% > 20% Migrations rescheduled
Time due to LNP not released
IT/BILLING
Xxxx Production 30% 5 days 6 days > 7 days > 15 days Bus Days
Special Processing 10% 3 days 4 days > 5 days Bus Days
CRBI 30% > 2.5 > 3 > 4 Min 10 MSRs
Billing fixes 30 < 75% < 65% < 55% Min 10 MSRs
applied within
cycle
4.0 Service Level Agreement Definitions
All definitions are intended to be consistent with Seller's measures in place,
where they already exist, prior to close.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
"Svc Avail" is the Service Availability percentage, as defined as the total
number minutes of outage event time, divided by the total number of minutes in
the month. Only outage events impacting ten (10) or more T1s and/or any SME
related DS3s are used in this metric.
"OOS > 5 days" is the Out Of Service greater than 5 business days, as defined as
a SME Customer location that is out of service (total service impairment) for
greater than five (5) business days.
"MTTR OOS" is the percentage Out Of Service tickets (MSRs) that are repaired
within 4 hours. This MTTR metric is measured from the time the ticket (MSR) is
opened to when the ticket is assigned a "Fixed" status.
"MTTR SA" is the average repair time for Mean Time to Repair for a Service
Affecting ticket (MSR). This MTTR metric is measured from the time the ticket
(MSR) is opened to when the ticket is assigned a "Fixed" status.
"MACD Activity" is the average interval time for Moves, Adds, Changes, and
Delete orders. This metric is measured from the time an order (OES) step is
opened to when the appropriate step is assigned a "Complete" status. Seller and
Buyer will need to determine the appropriate step(s)/subflow(s) to measure in
each process flow.
"Quality Survey" is the percent of customer surveys with a response grade of
"very satisfied," "satisfied" and "neither dissatisfied or satisfied".
"LSR/Records" will be measure the interval from the time the appropriate step is
opened in OES until the associated step is closed.
"LNP Port on Time" will measure the successful release of LNP numbers to allow a
migration to complete on schedule.
"Xxxx Production" will measure the number of business days from the scheduled
start of a billing cycle until the appropriate files are delivered to the
Xxxx/Print vendor.
"Special Processing" will measure the number of business days from the
completion of a Xxxx Production cycle until all post cycle activity for special
processing is completed.
"CRBI" will measure the number of Customer Reported Billing Inquiries per 100
bills produced during a calendar month.
"Billing Fixes applied within cycle" will measure the percent of credit/xxxx
corrections deployed on the next customer's xxxx.
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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Confidential Treatment Requested by Pac-West Telecomm, Inc
EXHIBIT 9.5(c)
MCI, AT&T and SPRINT
Confidential Information Redacted and Filed Separately with the Commission.
Omitted Portions Indicated by [**].
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